Special Contract Act
Group 12:
Divya PGFA1416
Eisha Khanna PGFA1417
Vedaant Lakhotia PGFA1461
Prabhat Lohani PGFA1439
Devendra Choudhary PGFA1414
Ashutosh Shukla PGFA1411
SPECIAL CONTRACTS
CONTRACT
OF INDEMNITY
{SEC. 124 & 125 }
CONTRCAT OF GUARANTEE
{SEC. 126 TO 147 }
CONTRACT OF BAILMENT
{SEC. 148 TO 181 }
CONTRACT OF PLEDGE
CONTRACT OF
INDEMNITY
Meaning and Definition of Indemnity
Section 124 defines a contract of indemnity
as A contract of indemnity is a contract
whereby one party promises to save the
other from loss caused to him by the conduct
of the promisor himself or by the conduct of
any other person.
Definition of Indemnity under Section 124 is
restrictive.
FEATURES OF INDEMNITY
It must possess all ingredients of a valid agreement.
It is a contingent agreement to make good the loss.
The loss must be caused by human conduct only.
Loss must have actually been suffered.
PARTIES TO CONTRACT OF INDEMNITY
INDEMNIFIER:
INDEMNITY HOLDER:
Examples:
Motor insurance
Marine insurance
Fire insurance
Life insurance is not the contract of indemnity
Contract of Guarantee
Meaning and Definition
A contract of guarantee is defined by the Indian Contract Act, as A contract
to perform the promise or discharge the liability of a third person in case of
his default. A guarantee may be either oral or written. [section 126].
Example: S and P go into a shop. S says to the shopkeeper Let P have
the goods and if P fails to pay the amount , I will. This is the contract
of guarantee.
ESSENTIALS OF CONTRACT OF GUARANTEE:
Existence of a principal debt.
Consideration for a contract of guarantee.
There should be no misrepresentation or concealment.
Contract of guarantee must contain all the essential elements of
valid contract.
Contract of guarantee is a complete and separate contract by
itself.
PARTIES INVOLVED
Creditor
Principal debtor
Surety
CONTRACT OF
BAILMENT
What is Bailment?
Section 148 defines Bailment as:
The delivery of goods by one to another
person for some purpose, upon a contract that
they shall, when the purpose is accomplished,
be returned or otherwise disposed of
according to the directions of the person
delivering them. The person delivering the
goods is called the Bailor, and the person to
whom goods are delivered is called the Bailee
ESSENTIALS AND LEGAL RULES AS
TO BAILMENT:
Contract:
Delivery of Goods:
No Transfer of Ownership:
Delivery of Goods for Some Purpose:
Return of Specific Goods:
Movable Goods:
Deposit of Money Into Bank:
Rights Of Bailor
Right of indemnity for losses due to negligence by bailee[S.152]
Termination of bailment on inconsistent use by the bailee[S.153]
Compensation for unauthorised use by the bailee[S.154]
Compensation when the bailee mixes the goods bailed with own
goods [S.155]
Right of return of goods back[S.160]
Right to profit from goods bailed[S.163]
Duties Of Bailor
To Disclose faults in goods bailed [S.150]
To repay the necessary expenses [S.158]
To indemnify the bailee [S.164]
Liability on premature breach of bailment[S.159]
Rights Of Bailee
Right to compensation for loss on account of fault in goods
bailed[S.150]
Right to receive necessary expenses[S.158]
Right against premature termination of bailment[S.159]
Right to compensation in case of defective title[S.164]
Delivery of goods to one of the joint owners[S.165]
Right against third parties
Duties Of Bailee
Take reasonable care of goods[S.151]
Not to make unauthorized use of goods[S.154]
Not to mix goods with his own goods[S.155-157]
Duty to return goods[S.160&161]
Not doing any act inconistent with terms of bailment[S.153]
Returning any profit [S.163]
CONTRACT OF PLEDGE
OF PAWN
Section 172
Pledge is the bailment of goods as security for
payment of debt or performance of a promise.
Bailment of goods as a security for payment of
debts or performance of promise is called
pledge. The bailor is called pledgor or pawnor
and the bailee is called Pawnee.
ESSENTIALS OF PLEDGE:
Delivery of Goods:
Delivery of goods should be by way of security..
Goods must be movable.
RIGHTS AND DUTIES OF PAWNEE
Right of retainer {S.173}:
Right of particular lien
Right to extraordinary expenses {S.175}
Right in case of default of the pawnor
RIGHTS AND DUTIES OF PAWNOR
Right of redemption
Right to take back the goods.
