Contingent Contracts and Quasi Contracts: Mercantile Law

Contingent Contracts
And Quasi Contracts

Mercantile Law
Mercantile Law : Contingent & Quasi
Contracts
2
CONTINGENT CONTRACTS
Section 31of the Indian Contract Act defines
contingent contract as A contract to do
or not to do something if some event,
collateral to such contract, does or does
not happen
So in simple words, it may be defined as a
conditional contract.

Contracts
3
Essential Elements of Valid
Contingent Contract

There must be a valid contract.
The performance of the contract must be
conditional.
The event must be future uncertain.
The event must be collateral to the contract.
Contracts
4
Rules regarding the
enforcement of the Contingent
Contract
It depends on the happening of the future
uncertain event. So the contract will be enforced
only if that uncertain event has happened. (Section
32)
It depends on the Non-Happening of the future
uncertain event. So the contract will be enforced
only if the happening of that uncertain event
becomes impossible as that event cannot happen.
(Section 33)

Contracts
5
Rules regarding the
enforcement of the Contingent
Contract Cont..
It depends on the happening of the specified
uncertain event within the fixed time. So the
contract will be enforced only if that uncertain
event happens within the fixed time. (Section 35)
It depends on the Non-Happening of the specified
uncertain event within the fixed time. So the
contract will be enforced only if the happening of
that uncertain event becomes impossible within
the fixed time as that event cannot happen.
(Section 35, second para)

Contracts
6
Rules regarding the enforcement
of the Contingent Contract Cont..
Contingent Contract dependent on the
impossible event is void and cannot be
enforced by law as the impossible event will
never happen. This will be void whether the
impossibility of the event is known or not to
the parties at the time of making the
contract.
Contracts
7
Multiple Choice Questions
(MCQS)
1. A agrees to pay Rs 5000 to B if Bs car is
burnt. It is
a. Void
b. Voidable
c. Illegal
d. Valid

Contracts
8
(MCQS)
1. A agrees to pay Rs 5000 to B if Bs car is
burnt. It is
a. Void
b. Voidable contract
c. Wagering Agreement
d. Valid Contract

Contracts
9
(MCQS)
2. Which of the following is not an essential
requirement of a valid contingent requirement:

a. The performance must be conditional.
b. The event must be uncertain.
c. The event must form the part of the contract.
d. The event must be independent or ancillary

Contracts
10
(MCQS)
2. Which of the following is not an essential
requirement of a valid contingent requirement:

a. The performance must be conditional.
b. The event must be uncertain.
c. The event must form the part of the contract.
d. The event must be independent or ancillary

Contracts
11
(MCQS)
3. An uncertain event on the happening or non
happening of which the performance of a
contingent contract depends:
a. Must be an act of the party.
b. Must not be an act of the parties.
c. Must be some other independent event.
d. May be an act of the parties or some
other independent event.
Contracts
12
(MCQS)
3. An uncertain event on the happening or non
happening of which the performance of a
contingent contract depends:
a. Must be an act of the party.
b. Must not be an act of the parties.
c. Must be some other independent event.
d. May be an act of the parties or some
other independent event.

Contracts
13
(MCQS)
4. A contingent contract depending on the
happening of the impossible event is:
a. Void
b. Voidable
c. Valid
d. Illegal
Contracts
14
(MCQS)
4. A contingent contract depending on the
happening of the impossible event is:
a. Void
b. Voidable
c. Valid
d. Illegal

Contracts
15
(MCQS)
5. A contract of life insurance is a:

a. Contract of indemnity
b. Contingent contract
c. Wagering agreement
d. Uncertain agreement
Contracts
16
(MCQS)
5. A contract of life insurance is a:

a. Contract of indemnity
b.Contingent contract
c.Wagering agreement
d.Uncertain agreement

Contracts
17
(MCQS)
6. A contingent contract dependent on the
Non-Happening of the future uncertain
event can be enforced when that event:
a. Happens
b. Becomes impossible
c. Does not becomes impossible
d. Both a and c.
Contracts
18
(MCQS)
event can be enforced when that event:
a. Happens
d. Both a and c.

Contracts
19
(MCQS)
event becomes void when such event:
a. Happens
d. Both a and c.

Contracts
20
(MCQS)
event becomes void when such event:
a. Happens
d. Both a and c.

Contracts
21
(MCQS)
8. A contracts to pay Rs 50,000 to B if B
marries C. But C dies before marriage. The
contract between A and B:
a. cannot be enforced.
b. can be enforced at the option of A.
c. can be enforced if B marries Cs sister.
d. can be enforced at the option of B.

Contracts
22
(MCQS)
8. A contracts to pay Rs 50,000 to B if B
marries C. But C dies before marriage. The
contract between A and B:
a. cannot be enforced.
b. can be enforced at the option of A.
c. can be enforced if B marries Cs sister.
d. can be enforced at the option of B.

Contracts
23
(MCQS)
9. A contract of insurance which does not
provide for the payment of the fixed amount
but according to the loss suffered by the
injured person, is a:
a. Contract of indemnity.
b. contract of guarantee.
c. wagering agreement
d. contingency contract
Contracts
24
(MCQS)
9. A contract of insurance which does not
provide for the payment of the fixed amount
but according to the loss suffered by the
injured person, is a:
a. Contract of indemnity.
b. contract of guarantee.
c. wagering agreement
d. contingency contract

Contracts
25
(MCQS)
10. Legally the term contingency contract is
defined in:
a. Section 30
b. Section 31
c. Section 56
d. Section 68

Contracts
26
(MCQS)
10. Legally the term contingency contract is
defined in:
a. Section 30
b. Section 31
c. Section 56
d. Section 68

Contracts
27
QUASI CONTRACT
It an obligation, which the law creates in
the absence of the agreement. It is not a
contract in the strict sense of the term
because there is no real contract in
existence. A contract is intentionally entered
into. A quasi contract is , on the other hand,
is created by law. Moreover there is no
intension of the parties to enter into the
contract. The Indian Contract Act does not
use the term Quasi Contract for such
obligation.
Contracts
28
QUASI CONTRACT
It describes quasi contracts as certain
contracts resembling those created by
the contract. These have been named
as quasi contract because although
there is no contract or agreement
between the parties, they are put in the
position as if the there was a contract
between them.
Contracts
29
BASIS OF QUASI
CONTRACT
It is based on the maxim of nomo
debet locuplatari ex liena justua i.e.
no man must grow rich out of another
persons costs. In other words ,a person
shall not be allowed to enrich himself
at the expense of another.
Contracts
30
QUASI CONTRACT
The principle of unjust requires:
a. the defendant has been enriched by the
receipt of the benefit.
b. this enrichment is at the expense of
plaintiff.
c. the retention of the enrichment is unjust.

Contracts
31
Kinds of Quasi Contract
1. Supply of necessaries to persons who are
incompetent to contract (Section68).
2. Payment by the interested person(Sec. 69).
3. Non-gratuitous acts(Section70).
4. Finder of Goods(Section71).
5. Payment of money or deliver of goods by
mistake or under coercion(Section72).
Contracts
32
Section 68
Claim for necessaries supplied to person
incapable of contracting: Sometimes a
person supplies the necessaries to the
person incompetent to enter into the
contract( i.e. minor, persons of unsound
mind etc.). In such cases, the person
supplying the necessaries is entitled to
recover the cost of necessaries from the
property of such incompetent person even if
there is no valid contract between them.
Contracts
33
Section 69
Right to recover money paid for another person:
Sometimes the person makes the payment which
is the legal duty of another person. In such a case
the person who has made the payment can recover
such a money from the person who is legally
bound to pay. Such type of cases generally arise
when the payment is made by the interested party
to protect the property from going in the hands of
another person.
Contracts
34
Section 69 Cont
The essential requirement of section 69 are
as follows:
1. The payment made should be bonafide for
the protection of ones interest.
2. The payment should be a voluntary one.
3. The payment must be such as the other
party was bound by law to pay.

Contracts
35
Section 70
Obligation of the person enjoying the
benefits of non-gratuitous acts:Where a
person lawfully does anything for another
person, or delivers anything to him not
intending to do so gratuitously and such
other person enjoys the benefit thereof , the
later is bound to make compensation to the
former in respect of , or to restore , the
thinks so done or delivered.
Contracts
36
Section 70 Cont
The following conditions must be satisfied for
the recovery of the compensation for non
gratuitous acts:
1. The person must lawfully do something for
another person or deliver some thing to him.
2. The person doing some act or delivering
something must not intend to act gratuitously.
3. The other person must voluntarily accept the acts
or goods and he must have enjoyed the benefits.

Contracts
37
Section 71
Responsibility of the finder of the
goods:
A person who finds the goods belonging
to another person and takes them into
his custody subject to the same
responsibility as that of bailee. He is
not to appropriate the goods use and
when the owner is traced, to restore it to
the owner.
Contracts
38
Section 71Cont
He is therefore required to take as much
care of the goods found as a man of
ordinary prudence would under the similar
circumstances take care of his own goods of
the same bulk, quantity and value as those
of the goods found.
Contracts
39
Section 72
Liability for money paid or thing
delivered by mistake or under coercion:
A person to whom the money has been
paid, or anything delivered, by mistake or
under coercion must repay or return it.
Contracts
40
(MCQS)
1. About Quasi obligation, which of the
following is correct:
a. There is no real contract in existence
b. There is no offer and acceptance.
c. There is no intension to make contract.
d. All of these.

Contracts
41
(MCQS)
1. About Quasi obligation, which of the
following is correct:
a. There is no real contract in existence
b. There is no offer and acceptance.
c. There is no intension to make contract.
d. All of these.

Contracts
42
(MCQS)
2. Quasi contracts are enforceable even if
the essential elements of the contract are not
present:
a. True, as quasi contractual obligation have
been made specifically made enforceable.
b. False, as an agreement which lacks
essential elements is void and unforceable.
Contracts
43
(MCQS)
2. Quasi contracts are enforceable even if the
essential elements of the contract are not
present:
a. True, as quasi contractual obligation
have been made specifically made
enforceable.
b. False, as an agreement which lacks
essential elements is void and unforceable.

Contracts
44
(MCQS)
3. The basis of quasi contractual obligation is the:
a. Existence of a valid contract between the
parties.
b. Existence of a voidable contract between the
parties.
c. Prevention of unjust enrichment at the expense
of others.
d. Provision contained in section 10 of the
contract.

Contracts
45
(MCQS)
3. The basis of quasi contractual obligation is the:
a. Existence of a valid contract between the
parties.
b. Existence of a voidable contract between the
parties.
c. Prevention of unjust enrichment at the
expense of others.
d. Provision contained in section 10 of the
contract.

Contracts
46
(MCQS)
4. Quasi contractual relations are based upon
the intensions of the parties:
a. True, an intensions is the basis of every
enforceable contract.
b. False, as this relation is imposed upon the
parties by the law.
Contracts
47
(MCQS)
4. Quasi contractual relations are based upon
the intensions of the parties:
a. True, an intensions is the basis of every
enforceable contract.
b. False, as this relation is imposed upon
the parties by the law.

Contracts
48
(MCQS)
5. A paid some money to B by mistake which was in
fact due to C. in this case:
a. A is not entitled to recover money as there is no
contract between A & B
b. A is not entitled to recover money as mistake
makes the agreement, if any void.
c. A is not entitled to recover money under
section72 0f Indian contract act.
d. B is not liable to pay as he did not ask for such
payment.
Contracts
49
(MCQS)
5. A paid some money to B by mistake which was in
fact due to C. in this case:
a. A is not entitled to recover money as there is no
contract between A & B
b. A is not entitled to recover money as mistake
makes the agreement, if any void.
c. A is entitled to recover money under section
72 of Indian contract act.
d. B is not liable to pay as he did not ask for such
payment.

Contracts
50
(MCQS)
6. If the obligation created by the quasi contract has
not been discharged, then the injured party
becomes entitled to receive compensation from the
party in default:
a. True, as section 73 makes a provision in this
regard.
b. True, as section 73 simply makes the quasi
contract enforceable without consideration.
Contracts
51
(MCQS)
6. If the obligation created by the quasi contract has
not been discharged, then the injured party
becomes entitled to receive compensation from the
party in default:
a. True, as section 73 makes a provision in this
regard.
b. True, as section 73 simply makes the quasi
contract enforceable without consideration.

Contracts
52
(MCQS)
7. As property was wrongly advertise for
sale for recovery of government revenue
due from B. In order to save his property,
A paid the government dues.In this case,
A is entitled to recover the amount of dues
paid by him from B on the basis of:
a. Government contract b. Valid contract
c. Quasi contract d. None of these
Contracts
53
(MCQS)
7. As property was wrongly advertise for
sale for recovery of government revenue
due from B. In order to save Bs property, A
paid the government dues.In this case, A is
entitled to recover the amount of dues paid
by him from B on the basis of:
a. Government contract b. Valid contract
c. Quasi contract d. None of these

Contracts
54
(MCQS)
8.A, a tradesman left certain goods at Bs house by
mistake, who treats the goods as his own. In this
case:
a. B is not bound to pay the goods as there is no
binding contract.
b. B is bound to pay as As act is non gratuitous
and quasi contract arises between them under
section 70.
c. A is not entitled to recover as no such relations
arise under section 70 due to ones own mistake.
d. The contract is voidable at the option of either
party.
Contracts
55
(MCQS)
8.A, a tradesman left certain goods at Bs house by
mistake, who treats the goods as his own. In this
case:
a. B is not bound to pay the goods as there is no
binding contract.
b. B is bound to pay as As act is non gratuitous
and quasi contract arises between them under
section 70.
c. A is not entitled to recover as no such relations
arise under section 70 due to ones own mistake.
d. The contract is voidable at the option of either
party.

Contracts
56
(MCQS)
9. A supplies to B, a lunatic, the necessaries
suitable to his conditions in life.In this case:
a. B is personally liable to pay.
b. Bs property is liable.
c. Bs parents are personally liable.
d. If Bs property is not sufficient to
reimburse, then he is personally liable.
Contracts
57
(MCQS)
9. A supplies to B, a lunatic, the necessaries
suitable to his conditions in life.In this case:
a. B is personally liable to pay.
b. Bs property is liable.
c. Bs parents are personally liable.
d. If Bs property is not sufficient to
reimburse, then he is personally liable.

Contracts
58
(MCQS)
10. Which of the following expression is used in the
Indian Contract Act in the part dealing with
quasi contract?
a. Quasi contractual obligations.
b. Certain relations of Quasi contractual
obligations.
c. Certain relations resembling those created by
contract.
d. Obligation in absence of actual contract.

Contracts
59
(MCQS)
10. Which of the following expression is used
in the Indian Contract Act in the part
dealing with quasi contract?
a. Quasi contractual obligations.
b. Certain relations of Quasi contractual
obligations.
c. Certain relations resembling those
created by contract.
d. Obligation in absence of actual contract.

Contracts
60
(MCQS)
11. A quasi contract is a:
a. A contract
b. A legal obligation
c. An agreement
d. A contingent contract
Contracts
61
(MCQS)
11. A quasi contract is a:
a. A contract
b. A legal obligation
c. An agreement
d. A contingent contract

Contracts
62
(MCQS)
12. A quasi contract is not enforceable
contract:
a. True
b. False

Contracts
63
(MCQS)
12. A quasi contract is not enforceable
contract:
a. True
b. False
Reason:A quasi contract is enforceable as per
the rules contained in sections 68 to 72.

Contracts
64
(MCQS)
13.
The Indian contract Act expressly uses the
words quasi contracts to give legal
recognition to these contracts.
a. Correct b. Incorrect
Contracts
65
(MCQS)
13. The Indian contract Act expressly uses
the words quasi contracts to give legal
recognition to these contracts.
a. Correct b. incorrect
Reason: The Indian contract Act expressly
uses the words Certain relations
resembling those created by contract for
quasi contractual obligation.
THE END
Contingent & Quasi Contracts

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Contingent Contracts

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