Sections Particulars
Preliminary
1 Short title
This Act may be called the Indian Contract Act, 1872.Extent, commencement-It extends to the whole of India 1[except the State of Jammu and Kashmir]; and it sha...
2 Interpretation-clause
In this Act the following words and expressions are used in the following senses, unless contrary intention appears from the context:(a) When one person signif...
Chapter I Communication, Acceptance and Revocation of Proposals
3 Communication, acceptance and revocation of proposals
The communication of proposals, the acceptance of proposals, and the revocation of proposals and acceptances, respectively, are deemed to be made by any act o...
4 Communication when complete
The communication of a proposal is complete when it becomes to the knowledge of the person to whom it is made.The communication of an acceptance is complete-as...
5 Revocation of proposals and acceptances
A proposal may be revoked at any time before the communication of its acceptance is complete as against the proposer, but not afterwards. An acceptance may be ...
6 Revocation how made
A proposal is revoked-(1) by the communication of notice of revocation by the proposer to the other party;(2) by the lapse of the time prescribed in such propo...
7 Acceptance must be absolute
In order to convert a proposal into a promise the acceptance must-(1) be absolute and unqualified.(2) be expressed in some usual and reasonable manner, unless ...
8 Acceptance by performing conditions, or receiving consideration
Performance of the conditions of a proposal, for the acceptance of any consideration for a reciprocal promise which may be offered with a proposal, is an acce...
9 Promises, express and implied
In so far as the proposal or acceptance of any promise is made in words, the promise is said to be express. In so far as such proposal or acceptance is made o...
Chapter II Contracts, Voidable Contracts, and Void Agreements
10 What agreements are contracts
All agreements are contracts if they are made by the free consent of parties competent to contract, for a lawful consideration and with a lawful object, and a...
11 Who are competent to contract
Every person is competent to contract who is of the age of majority according to the law to which he is subject, and who is of sound mind and is not disqualif...
12 What is a sound mind for the purposes of contracting
A person is said to be of sound mind for the purposes of making a contract, if , at the time when he makes it, he is capable of understanding it and of formin...
13 Consent defined
Two or more persons are said to consent when they agree upon the same thing in the same sense....
14 Free consent defined
Consent is said to be free when it is not caused by-(1) coercion, as defined in section 15, or(2) undue influence, as defined in section 16, or(3) fraud, as def...
15 Coercion defined
"Coercion" is the committing, or threatening to commit, any act forbidden by the Indian Penal Code (45 of 1860) or the unlawful detaining, or threatening to d...
16 Undue influence defined
(1) A contract is said to be induced by "undue influence" where the relations subsisting between the parties are such that one of the parties is in a position...
18 Misrepresentation defined
"Misrepresentation" means and includes-(1) the positive assertion, in a manner not warranted by the information of the person making it, of that which is not t...
19 Voidability of agreements without free consent
When consent to an agreement is caused by coercion, 4A[***] fraud or misrepresentation, the agreement is a contract voidable at the option of the party whose ...
19A Power to set aside contract induced by undue influence
When consent to an agreement is caused by undue influence, the agreement is a contract voidable at the option of the party whose consent was so caused.Any suc...
20 Agreement void where both parties are under mistake as to matter of fact
Where both the parties to an agreement are under a mistake as to a matter of fact essential to the agreement, the agreement, the agreement is void.An erroneou...
21 Effect of mistakes as to law
A contract is not voidable because it was caused by a mistake as to any law in force in 6[India]; but a mistake as to a law not in force in 6[India] has the s...
22 Contract caused by mistake of one party as to matter of fact
A contract is not voidable merely because it was caused by one of the parties to it being under a mistake as to a matter of fact....
23 What consideration and objects are lawful, and what not
The consideration or object of an agreement is lawful, unless -It is forbidden by law; oris of such nature that, if permitted it would defeat the provision of ...
24 Agreements void, if considerations and objects unlawful in part
If any part of a single consideration for one or more objects, or any one or any part of any one of several considerations for a single object, is unlawful, t...
25 Agreement without consideration, void, unless it is in writing and registered or is a promise to compensate for something done or is a promise to pay a debt barred by limitation law
An agreement made without consideration is void, unless-(1) it is expressed in writing and registered under the law for the time being in force for the registr...
26 Agreement in restraint of marriage, void
Every agreement in restraint of the marriage of any person, other than a minor, is void....
27 Agreement in restraint of trade, void
Every agreement by which anyone is restrained from exercising a lawful profession, trade or business of any kind, is to that extent void.Saving of agreement no...
28 Agreements in restraint of legal proceedings, void
11[Every agreement,-(a) by which any party thereto is restricted absolutely from enforcing his rights under or in respect of any contract, by the usual legal ...
29 Agreements void for uncertainty
Agreements, the meaning of which is not certain, or capable of being made certain, are void.Illustrations(a) A agrees to sell B "a hundred tons of oil". There ...
30 Agreements by way of wager, void
Agreements by way of wager are void; and no suit shall be brought for recovering anything alleged to be won on any wager, or entrusted to a person to abide th...
Chapter III Contingent Contracts
31 Contingent contract defined
A "contingent contract" is a contract to do or not to do something, if some event, collateral to such contract, does or does not happen.IllustrationA contract...
32 Enforcement of contracts contingent on an event happening
Contingent contracts to do or nor to do anything in an uncertain future event happens, cannot be enforced by law unless and until that event has happened.If t...
33 Enforcement of contract contingent on an event not happening
Contingent contracts to do or not to do anything if an uncertain future event does not happen, can be enforced when the happening of that event becomes imposs...
34 When event on which contract is contingent to be deemed impossible, if it is the future conduct of a living person
If the future event on which a contract is contingent is the way in which a person will act at an unspecified time, the event shall be considered to become im...
35 When contracts become void, which are contingent on happening of specified event within fixed time
Contingent contracts to do or not to do anything, if a specified uncertain event happens within a fixed time, become void, if, at the expiration of the time f...
36 Agreements contingent on impossible events, void
Contingent agreements to do or not to do anything, if an impossible event happens, are void, whether the impossibility of the event is known or not to the par...
Chapter IV Performance of Contracts which must be Performed
37 Obligations of parties to contracts
The parties to a contract must either perform, or offer to perform, their respective promises, unless such performance is dispensed with or excused under the ...
38 Effect of refusal to accept offer of performance
Where a promisor has made an offer of performance to the promisee, and the offer has not been accepted, the promisor is not responsible for non-performance, n...
39 Effect of refusal of party to perform promise wholly
When a party to a contract has refused to perform, or disabled himself from performing, his promise in its entirety, the promisee may put an end to the contra...
40 Person by whom promise is to be performed
If it appears from the nature of the case that it was the intention of the parties to any contract that any promise contain in it should be performed by the p...
41 Effect of accepting performance from third person
When a promisee accepts performance of the promise from a third person, he cannot afterwards enforce it against the promisor....
42 Devolution of joint liabilities
When two or more person have made a joint promise, then, unless a contrary intention appears by the contract, all such persons, during their joint lives, and,...
43 Any one of joint promisors may be compelled to perform
When two or more persons make a joint promise, the promisee may, in the absence of express agreement to the contrary, compel any 13[one or more] of such joint...
44 Effect of release of one joint promisor
Where two or more persons have made a joint promise, a release of one of such joint promisors by the promisee does not discharge the other joint promisor or j...
45 Devolution of joint rights
When a person has made a promise to two or more persons jointly, then unless contrary intention appears from the contract, the right to claim performance rest...
46 Time for performance of promise, where no application is to be made and no time is specified
Where, by the contract, a promisor is to perform his promise without application by the promisee, and no time for performance is specified, the engagement mus...
47 Time and place for performance of promise, where time is specified and no application to be made
When a promise is, to be performed on a certain day, and the promisor has undertaken to perform it without the application by the promisee, the promisor may p...
48 Application for performance on certain day to be at proper time and place
When a promise is to be performed on a certain day, and the promisor has not undertaken to perform it without application by the promisee, it is the duty of t...
49 Place for the performance of promise, where no application to be made and no place fixed for performance
When a promise is to be performed without application by the promisee, and no place is fixed for the performance of it, it is the duty of the promisor to appl...
50 Performance, in manner or at time prescribed or sanctioned by promisee
The performance of any promise may be made in any manner, or at any time which the promisee prescribes or sanctions.Illustrations(a) B owes A 2,000 rupees. A d...
51 Promisor not bound to perform, unless reciprocal promisee ready and willing to perform
When a contract consists of reciprocal promises to be simultaneously performed, no promisor need perform his promise unless the promisee is ready and willing ...
52 Order of performance of reciprocal promises
Where the order in which reciprocal promises are to be performed is expressly fixed by the contract, they shall be performed in that order, and where the orde...
53 Liability of party preventing event on which contract is to take effect
When a contract contains reciprocal promises, and one party to the contract prevents the other from performing his promise, the contract becomes voidable at t...
54 Effect of default as to the promise which should be performed, in contract consisting of reciprocal promises
When a contract consists of reciprocal promises, such that one of them cannot be performed, or that its performance cannot be claimed till the other has been ...
55 Effect of failure to perform at fixed time, in contract in which time is essential
When a party to a contract promises to do a certain thing at or before a specified time, or certain things at or before a specified time and fails to do su...
56 Agreement to do impossible act
An agreement to do an act impossible in itself is void.Contract to do act afterwards becoming impossible or unlawful: A contract to do an act which, after the ...
57 Reciprocal promise to do things legal, and also other things illegal
Where persons reciprocally promise, firstly to do certain things which are legal, and, secondly under specified circumstances, to do certain other things whic...
58 Alterative promise, one branch being illegal
In the case of an alternative promise, one branch of which is legal and the other illegal, the legal branch alone can be enforced.IllustrationA and B agree tha...
59 Application of payment where debt to be discharged is indicated
Where a debtor, owing several distinct debts to one person, makes a payment to him, either with express intimation, or under circumstances implying, that the ...
60 Application of payment where debt to be discharged is not indicated
Where the debtor has omitted to intimate, and there are no other circumstances indicating to which debt the payment is to be applied, the creditor may apply i...
61 Application of payment where neither party appropriates
Where neither party makes any appropriation, the payment shall be applied in discharge of the debts in order of time, whether they are or are not barred by th...
62 Effect of novation, rescission, and alteration of contract
If the parties to a contract agree to substitute a new contract for it, or to rescind or alter it, the original contract need not be performed.Illustrations(a)...
63 Promise may dispense with or remit performance of promise
Every promisee may dispense with or remit, wholly or in part, the Performance of the promise made to him, or may extend the time for such performance, for may...
64 Consequence of rescission of a voidable contract
When a person at whose option a contract is voidable rescinds it, the other party thereto need to perform any promise therein contained in which he is the pro...
65 Obligation of person who has received advantage under void agreement, or contract that becomes void
When an agreement is discovered to be void, or when a contract becomes void, any person who has received any advantage under such agreement or contract is bou...
66 Mode of communicating or revoking rescission of voidable contract
The rescission of a voidable contract may be communicated or revoked in the same manner, and subject to the same rules, as apply to the communication or revoc...
67 Effect of neglect of promisee to afford promisor reasonable facilities for performance
If any promisee neglects or refuses to afford the promisor reasonable facilities for the performance of his promise, the promisor is excused by such neglect o...
Chapter V Certain Relations Resembling those created by Contract
68 Claim for necessaries supplied to person incapable of contracting, or on his account
If a person, incapable of entering into a contract, or anyone whom he is legally bound to support, is supplied by another person with necessaries suited to hi...
69 Reimbursement of person paying money due by another, in payment of which he is interested
A person who is interested in the payment of money which another is bound by law to pay, and who therefore pays it, is entitled to be reimbursed by the other....
70 Obligation of person enjoying benefit of non-gratuitous act
Where a person lawfully does anything for another person, or delivers anything to him, not intending to do so gratuitously, and such another person enjoys the...
71 Responsibility of finder of goods
A person who finds goods belonging to another, and takes them into his custody, is subject to the same responsibility as a bailee....
72 Liability of person to whom money is paid, or thing delivered, by mistake or under coercion
A person to whom money has been paid, or anything delivered, by mistake or under coercion, must repay or return it.Illustrations(a) A and B jointly owe 100 rup...
Chapter VI The Consequences of Breach of Contract
73 Compensation of loss or damage caused by breach of contract
When a contract has been broken, the party who suffers by such breach is entitled to receive, from the party who has broken the contract, compensation for any...
74 Compensation for breach of contract where penalty stipulated for
15[When a contract has been broken, if a sum is named in the contract as the amount be paid in case of such breach, or if the contract contains any other stip...
75 Party rightfully rescinding contract, entitled to compensation
A person who rightfully rescinds a contract is entitled to consideration for any damage which he has sustained through the non-fulfillment of the contract.Ill...
Chapter VII Sections 76-123
Chapter VIII Indemnity and Guarantee
124 Contract of indemnity defined
A contract by which one party promises to save the other from loss caused to him by the contract of the promisor himself, or by the conduct of any other perso...
125 Right of indemnity-holder when sued
The promisee in a contract of indemnity, acting within the scope of his authority, is entitled to recover from the promisor-(1) all damages which he may be com...
126 Contract of guarantee, "surety", "principal debtor" and "creditor"
A "contract of guarantee" is a contract to perform the promise, or discharge the liability, of a third person in case of his default. The person who gives the...
127 Consideration for guarantee
Anything done, or any promise made, for the benefit of the principal debtor, may be a sufficient consideration to the surety for giving the guarantee.Illustra...
128 Surety's liability
The liability of the surety is co-extensive with that of the principal debtor, unless it is otherwise provided by the contract.IllustrationA guarantees to B th...
129 Continuing guarantee
A guarantee which extends to a series of transaction, is called, a "continuing guarantee".Illustrations(a) A, in consideration that B will employ C in collecti...
130 Revocation of continuing guarantee
A continuing guarantee may at any time be revoked by the surety, as to future transactions, by notice to the creditor.Illustrations(a) A, in consideration of B...
131 Revocation of continuing guarantee by surety's death
The death of the surety operates, in the absence of any contract to the contrary, as a revocation of a continuing guarantee, so far as regards future transact...
132 Liability of two persons, primarily liable, not affected by arrangement between them that one shall be surety on other's default
Where two persons contract with a third person to undertake a certain liability, and also contract with each other that one of them shall be liable only on th...
133 Discharge of surety by variance in terms of contract
Any variance made without the surety's consent, in the terms of the contract between the principalĀ  17[debtor] and the creditor, discharges the surety as to t...
134 Discharge of surety by release or discharge of principal debtor
The surety is discharged by any contract between the creditor and the principal debtor, by which the principal debtor is released, or by any act or omission o...
135 Discharge of surety when creditor compounds with, gives time to, or agrees not to sue, principal debtor
A contract between the creditor and the principal debtor, by which the creditor makes a composition with, or promises to give time to, or not to sue, the prin...
136 Surety not discharged when agreement made with third person to give time to principal debtor
Where a contract to give time to he principal debtor is made by the creditor with a third person, and not with the principal debtor, the surety is not dischar...
137 Creditor's forbearance to sue does not discharge surety
Mere forbearance on the part of the creditor to sue the principal debtor or to enforce any other remedy against him, does not, in the absence of any provision...
138 Release of one co-surety does not discharge others
Where there are co-sureties, a release by the creditor of one of them does not discharge the othersĀ  neither does it free the surety so released from his resp...
139 Discharge of surety by creditor's act or omission impairing surety's eventual remedy
If the creditor does any act which is inconsistent with the right of the surety, or omits to do any act which his duty to the surety requires him to do, and t...
140 Rights of surety on payment or performance
Where a guaranteed debt has become due, or default of the principal debtor to perform a guaranteed duty has taken place, the surety upon payment or performanc...
141 Surety's right to benefit of creditor's securities
A surety is entitled to the benefit of every security which the creditor has against the principal debtor at the time when the contract of suretyship entered ...
142 Guarantee obtained by misrepresentation, invalid
Any guarantee which has been obtained by means of misrepresentation made by the creditor, or with his knowledge and assent, concerning a material part of the ...
143 Guarantee obtained by concealment, invalid
Any guarantee which the creditor has obtained by means of keeping silence as to material circumstances, is invalid.Illustrations(a) A engages B as clerk to col...
144 Guarantee on contract that creditor shall not act on it until co-surety joins
Where a person gives a guarantee upon a contract that the creditor shall not act upon it until another person has jointed in it as co-surety, the guarantee is...
145 Implied promise to indemnify surety
In every contract of guarantee there is an implied promise by the principal debtor to indemnify the surety, and the surety is entitled to recover from the pri...
146 Co-sureties liable to contribute equally
Where two or more persons are co-sureties for the same debt or duty, either jointly or severally, and whether under the same or different contracts, and wheth...
147 Liability of co-sureties bound in different sums
Co-sureties who are bound in different sums are liable to pay equally as far as the limits of their respective obligations permit.Illustrations(a) A, B and C, ...
Chapter IX Bailment
148 Bailment, "bailor" and "bailee" defined
A "bailment" is the delivery of goods by one person to another for some purpose, upon a contract that they shall, when the purpose is accomplished, be returne...
149 Delivery to bailee how made
The delivery to the bailee may be made by doing anything which has the effect of putting the goods in the possession of the intended bailee or of any person a...
150 Bailor's duty to disclose faults in goods bailed
The bailor is bound to disclose to the bailee faults in the goods bailed, of which the bailor is aware, and which materially interfere with the use of them, o...
151 Care to be taken by bailee
In all cases of bailment the bailee is bound to take as much care of the goods bailed to him as a man of ordinary prudence would, under similar circumstances,...
152 Bailee when not liable for loss, etc, of thing bailed
The bailee, in the absence of any special contract, is not responsible for the loss, destruction or deterioration of the thing bailed, if he has taken the amo...
153 Termination of bailment by bailee's act inconsistent with conditions
A contract of bailment is voidable at the option of the bailor, if the bailee does any act with regard to the foods bailed, inconsistent with the conditions o...
154 Liability of bailee making unauthorized use of goods bailed
If the bailee makes any use of the goods bailed which is not according to the conditions of the bailment, he is liable to make compensation to the bailor for ...
155 Effect of mixture with bailor's consent, of his goods with bailee's
If the bailee, with the consent of the bailor, mixes the goods of the bailor with his own goods, the bailor and the bailee shall have an interest, in proporti...
156 Effect of mixture, without bailor's consent, when the goods can be separated
If the bailee, without the consent of the bailor, mixes the goods of the bailor with his own goods and the goods can be separated or divided, the property in ...
157 Effect of mixture, without bailor's consent, when the goods cannot be separated
If the bailee, without the consent of the bailor, mixes the foods of the bailor with his own goods in such a manner that it is impossible to separate the good...
158 Repayment, by bailor, of necessary expenses
Where, by the conditions of the bailment, the goods are to be kept or to be carried, or to have work done upon them by the bailee for the bailor, and the bail...
159 Restoration of goods lent gratuitously
The lender of a thing for use may at any time require its return, if the loan was gratuitous, even through he lent it for a specified time or purpose. But if,...
160 Return of goods bailed, on expiration of time or accomplishment of purpose
It is the duty of the bailee to return, or deliver according to the bailor's directions, the goods bailed, without demand, as soon as the time for which they ...
161 Bailee's responsibility when goods are not duly returned
If by the fault of the bailee, the goods are not returned, delivered or tendered at the proper time, he is responsible to the bailor for any loss, destruction...
162 Termination of gratuitous bailment by death
A gratuitous bailment is terminated by the death either of the bailor or of the bailee....
163 Bailer entitled to increase or profit from goods bailed
In the absence of any contract to the contrary, the bailee is bound to deliver to the bailer, or according to his directions, any increase or profit which may...
164 Bailor's responsibility to bailee
The bailor is responsible to the bailee for any loss which the bailee may sustain by reason that the bailor was not entitled to make the bailment, or to recei...
165 Bailment by several joint owners
If several joint owners of goods bail them, the bailee may deliver them back to, or according to the directions of, one joint owner without the consent of all...
166 Bailee not responsible on redelivery to bailor without title
If the bailor has no title to the goods, and the bailee, in good faith, delivers them back to, or according to the directions of the bailor, the bailee is not...
167 Right of third person claiming goods bailed
If aperson, other than the bailor, claims goods bailed he may apply to the court to stop delivery of the goods to the bailor, and to decide the title to the g...
168 Right of finder of goods may sue for specified reward offered
The finder of goods has no right to sue the owner for compensation for trouble and expense voluntary incurred by him to preserve the goods and to find out the...
169 When finder of thing commonly on sale may sell it
When a thing which is commonly the subject of sale is lost, if the owner cannot with reasonable diligence be found, or if he refuses upon demand, to pay the c...
170 Bailee's particular lien
Where the bailee has, in accordance with the purpose of the bailment, rendered any service involving the exercise of labor or skill in respect of the goods ba...
171 General lien of bankers, factors, wharfingers, attorneys and policy brokers
Bankers, factor, wharfingers, attorneys of a High Court and policy brokers may, in the absence of a contract to the contrary, retain as a security for a gener...
172 Pledge, "pawnor", and "pawnee" defined
The bailment of goods as security for payment of a debt or performance of a promise is called "pledge". The bailor is in this case called the "pawnor". The ba...
173 Pawnee's right of retainer
The pawnee may retain the goods pledged, not only for payment of the debt or the performance of the promise, but for the interests of the debt, and all necess...
174 Pawnee not to retain for debt or promise other than that for which goods pledged-Presumption in case of subsequent advances
The pawnee shall not, in the absence of a contract to that effect, retain the goods pledged for any debt or promise of other than the debt or promise for whic...
175 Pawnee's right as to extraordinary expenses incurred
The pawnee is entitled to receive from the pawnor extraordinary expenses incurred by him for the preservation of the goods pledged....
176 Pawnee's right where pawnor makes default
If the pawnor makes default in payment of the debt, or performance, at the stipulated time, of the promise, in respect of which the goods were pledged, the pa...
177 Defaulting pawnor's right to redeem
If a time is stipulated for the payment of the debt, or performance of the promise, for which the pledge is made, and the pawnor makes default in payment of t...
178 Pledge by mercantile agent
Where a mercantile agent is, with the consent of the owner, in possession of goods or the documents of title to goods, any pledge made by him, when acting in ...
178A Pledge by person in possession under voidable contract
When the pawnor has obtained possession of other goods pledged by him under a contract voidable under section 19 or section 19A, but the contract has not been...
179 Pledge where pawnor has only a limited interest
Where person pledges goods in which he has only a limited interest, the pledge is valid to the extent of that interest....
180 Suit by bailor or bailee against wrong-doer
If a third person wrongfully deprives the bailee of the use of possession of goods bailed, or does them any injury, the bailee is entitled to use such remedie...
181 Appointment of relief or compensation obtained by such suits
Whatever is obtained by way of relief of compensation in any such suit shall, as between the bailor and the bailee, be dealt with according to their respectiv...
Chapter X Agency Appointment and Authority of agents
182 Agent and "principal" defined or to represent another
An "agent" is a person employed to do any act for another, who is so in dealings with third persons. The person for whom such act is done, or represented, is ...
183 Who may employ agent
Any person who is of the age of majority according to the law to which he is subject, and who is of sound mind, may employ an agent....
184 Who may be an agent
As between the principal and third persons, any person may become an agent, but no person who is not of the age of majority and sound mind can become an agent...
185 Consideration not necessary
No consideration is necessary to create an agency;...
186 Agent's authority may be express or implied
The authority of an agent may be express or implied....
187 Definitions of express and implied authority
An authority is said to be express when it is given by words spoken or written. An authority is said to be implied when it is to be inferred from the circumst...
188 Extent of agent's authority
An agent, having an authority to do an act, has authority to do every lawful thing which is necessary in order to do such act.An agent having an authority to c...
189 Agent's authority in an emergency
An agent has authority, in an emergency, to do all such acts for the purpose of protecting his principal from loss and would be done by a person or ordinary p...
190 When agent cannot delegate
An agent cannot lawfully employ another to perform acts which he has expressly or impliedly undertaken to perform personally, unless by the ordinary custom of...
191 Sub-agent defined
A "sub-agent" is a person employed by, and acting under the control of, the original agent in the business of the agency....
192 Representation of principal by sub-agent properly appointed
Where a sub-agent is properly appointed, the principal is, so far as regards third persons, represented by the sub-agent, and is bound by and responsible for ...
193 Agent's responsibility for sub-agent appointed without authority
Where an agent, without having authority to do so, has appointed a person to act as a sub-agent, the agent stands towards such person in the relation of a pri...
194 Relation between principal and person duly appointed by agent to act in business of agency
When an agent, holding an express or implied authority to name another person to act for the principal in the business of the agency, has named another person...
195 Agent's duty in naming such person
In selecting such agent for his principal, an agent is bound to exercise the same amount of discretion as a man of ordinary prudence would exercise in his own...
196 Right of person as to acts done for him without his authority-effect of ratification
Where acts are done by one person on behalf of another, but without his knowledge or authority, he may elect to ratify or to disown such acts. If he ratifies ...
197 Ratification may be expressed or implied
Ratification may be expressed or may be implied in the conduct of the person on whose behalf the acts are done.Illustrations(a) A, without authority, buys good...
198 Knowledge requisite for valid ratification
No valid ratification can be made by a person whose knowledge of the facts of the case is materially defective....
199 Effect of ratifying unauthorized act forming part of a transaction
A person ratifying any unauthorized act done on his behalf ratifies the whole of the transaction of which such act formed a part....
200 Ratification of unauthorized act cannot injure third person
An act done by one person on behalf of another, without such other person's authority, which, if done with authority would have the effect of subjecting a thi...
201 Termination of agency
An agency is terminated by the principal revoking his authority, or by the agent renouncing the business of the agency; or by the business of the agency being...
202 Termination of agency, where agent has an interest in subject-matter
Where the agent has himself an interest in the property which forms the subject-matter of the agency, the agency cannot, in the absence of an express contract...
203 When principal may revoke agent's authority
The principal may, save as is otherwise provided by the last preceding section, revoke the authority given to his agent at any time before the authority has b...
204 Revocation where authority has been partly exercised
The principal cannot revoke the authority given to his agent after the authority has been partly exercised, so far as regards such acts and obligations as ari...
205 Compensation for revocation by principal, or renunciation by agent
Where there is an express or implied contract that the agency should be continued for any period of time, the principal must make compensation to the agent, o...
206 Notice of revocation or renunciation
Reasonable notice must be given of such revocation or renunciation, otherwise the damage thereby resulting to the principal or the agent, as the case may be, ...
207 Revocation and renunciation may be expressed or implied
Revocation or renunciation may be expressed or may be implied in the conduct of that principal or agent respectively.IllustrationA empowers B to let A's house....
208 When termination of agent's authority takes effect as to agent, and as to third persons
The termination of the authority of an agent does not, so far as regards the agent, take effect before it becomes known to him, or, so far as regards third pe...
209 Agent's duty on termination of agency by principal's death or insanity
When an agency is terminated by the principal dying or becoming of unsound mind, the agent is bound to take on behalf of the representative, of his late princ...
210 Termination of sub-agent's authority
The termination of the authority of an agent causes the termination (subject to the rules herein contained regarding the termination of an agent's authority) ...
211 Agent's duty in conducting principal's business
An agent is bound to conduct the business of his principal according to the directions given by the principal, or in the absence of any such directions accord...
212 Skill and diligence required from agent
An agent is bound to conduct the business of the agency with as much skill as is generally possessed by person engaged in similar business unless the principa...
213 Agent's accounts
An agent is bound to render proper accounts to his principal on demand....
214 Agent's, duty to communicate with principal
It is the duty of an agent in case of difficulty, to use all reasonable diligence in communicating with his principal, and in seeking to obtain his instructio...
215 Right of principal when agent deals, on his own account, in business of agency without principal's consent
If an agent deals on his own account in the business of the agency, without first obtaining the consent of his principal and acquainting him with all material...
216 Principal's right to benefit gained by agent dealing on his own account in business of agency
If an agent, without the knowledge of his principal, deals in the business of the agency on his own account instead of on account to his principal, the princi...
217 Agent's right of retainer out of sums received on principal's account
An agent may retain, out of any sums received on account of the principal in the business of the agency, all moneys due to himself in respect of advances made...
218 Agent's duty to pay sums received for principal
Subject to such deductions, the agent is bound to pay to his principal all sums received on his account....
219 When agent's remuneration becomes due
In the absence of any special contract, payment for the performance of any act is not due to the agent until the completion of such act; but an agent may deta...
220 Agent not entitled to remuneration for business misconducted
An agent who is guilty of misconduct in the business of the agency, is not entitled to any remuneration in respect of that part of the business which he has m...
221 Agent's lien on principal's property
In the absence of any contract to the contrary, an agent is entitled to retain goods, papers, and other property, whether movable or immovable of the principa...
222 Agent to be indemnified against consequences of lawful acts
The employer of an agent is bound to indemnify him against the consequences of all lawful acts done by such agent in exercise of the authority conferred upon ...
223 Agent to be indemnified against consequences of acts done in good faith
Where one person employs another to do an act, and the agent does the act in good faith, the employer is liable to indemnify the agent against the consequence...
224 Non-liability of employer of agent to do a criminal act
Where one person employees another to do an act which is criminal, the employer is not liable to the agent, either upon an express or an implied promise to in...
225 Compensation to agent for injury caused by principal's neglect
The principal must make compensation to his agent in respect of injury caused to such agent by the principal's neglect or want of skill.IllustrationA employs B...
226 Enforcement and consequences of agent's contract
Contracts entered into through an agent, and obligations arising from acts done by an agent, may be enforced in the same manner, and will have the same legal ...
227 Principal how far bound, when agent exceeds authority
When an agent does more than he is authorized to do, and when the part of what he does, which is within his authority, can be separated from the part which is...
228 Principal not bound when excess of agent's authority is not separable
Where an agent does more than he is authorized to do, and what he does beyond the scope of his authority cannot be separated from what is within it, the princ...
229 Consequences of notice given to agent
Any notice given to or information obtained by the agent, provided it be given or obtained in the course of the business transacted by him for the principal, ...
230 Agent cannot personally enforce, nor be bound by, contracts on behalf of principal
In the absence of any contract to that effect an agent cannot personally enforce contracts entered into by him on behalf of his principal, nor is he personall...
231 Right of parties to a contract made by agent not disclosed
If an agent makes a contract with a person who neither, knows nor has reason to suspect, that he is an agent, his principal may require the performance of the...
232 Performance of contract with agent supposed to be principal
Where one man makes a contract with another, neither knowing nor having reasonable ground to suspect that the other is an agent, the principal, if he requires...
233 Right of person dealing with agent personally liable
In cases where the agent is personally liable, a person dealing with him may hold either him or his principal, or both of them liable.IllustrationA enters into...
234 Consequence of inducing agent or principal to act on belief that principal or agent will be held exclusively liable
When a person who has made a contract with an agent induce the agent to act upon the belief that the principal only will be held liable, or induces the princi...
235 Liability of pretended agent
A person untruly representing himself to be the authorized agent of another, and thereby including a third person to deal with him as such agent, is liable, i...
236 Person falsely contracting as agent, not entitled to performance
A person with whom a contract has been entered into in the character of agent, is not entitled to require the performance of it, if he was in reality acting, ...
237 Liability of principal inducing belief that agent's unauthorized acts were authorized
When an agent has, without authority, done acts or incurred obligations to third person on behalf of his principal, the principal is bound by such acts or obl...
238 Effect, on agreement, of misrepresentation or fraud by agent
Misrepresentation made or fraud committed, by agent acting in the course of their business for their principals, have the same effect on agreements made by su...
Chapter XI Of Partnership [Repealed by the Indian Partnership Act, 1932 (9 of 1932)]
Schedule Enactments [Repealed by the Repealing and Amending Act, 1914 (10 of 1914)]
Foot Notes
1 Substituted by Act No. 3 of the 1951 for the words "except Part B States".2 The words "The enactments mentioned in the Schedule hereto are repealed to the e...
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