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Personation of the Contract Act,1872

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The roots of the idea of enacting a law of contracts for the India can be traced to the visionary and optimistic remark of the second law commission, made in 1855, even though the sojourn of the codification of Indian law had begun in 1833, proceeding on the principle propounded by Lord Macaulay, viz, “Uniformity wherever you can have it, Diversity when you must have it, but in all cases, Certainty.

The second law commission not only mooted the idea of a codification of the law of contracts, but also spelt out the salient features of the codification policy to be followed in that endeavour, viz:

  1. Codification of Hindu law and the Muslim Law not to be attempted.
  2. English Law to be the basis, but only after simplify and stripping it of its techniques.
  3. The codified law to be applied uniformly to all in the country.

Progress in the codification was not made in the tenure of the Second Law commission, which was limited to 3 years. The appointment of the Third Law Commission in 1861, with the specific task of preparing a body of Substantive Civil Law of India, based on the recommendation of the Second Law Commission, was the founding step. No substantial progress was made till 1863.

The construction of the edifice and the drafting of the law of contracts for India, actually begun in 1863.

The Indian Contract Bill, which later became the Act, was drafted in England between 1863 and 1866, by the Third Law Commission, consisting of Romily MR. Erle CJ and Willes J. The draft bill was sent to India and was published with its statement of objects and reasons in 1867.In the statement of objects and reasons, it was described as a body of contract law which leaves nothing to be desired in the point of simplicity and comprehensiveness, in respect of the essential equity of its provisions and in respect of the perspicuity with which those provisions were set forth.

It was introduced in Indian Legislative Council and  was referred to the Select committee. It was sent, as usual to the local government for their opinions.

The opinions of the local government were given in 1868. Some provisions in the draft caused difference of opinions between those who were responsible  for it in India, i.e. the Indian Legislature, and those in England i.e. the Third Law Commission. Discussions on the difference consumed almost a year.

At the end of 1869, the bill was still before the Select Committee. The Select Committee, to which Bill was referred, ventured to criticize and modify the proposals of the Commission with a freedom which that learned body resented. The select committee submitted its report in 1870, to the secretary of the state. This report suggested certain changes in the draft. In the meantime, considerable friction had arisen between the Law Commission and the Government of India. The commission did not like its draft being modified. It resigned in protest. Thus expired in a huff, the Third of the Indian Law Commissions.

The Indian Government was allowed to take its own course with the Contract Bill. The Secretary of State permitted the Government of India to decide on the alterations to the draft. The bill was again introduced in the Indian Legislature in 1871. It was revised in India by Sir James Stephen and was placed on the statute book in 1872. The vision and optimism writ large in the remark of the Second Law Commission, made in 1855, thus became a reality, though, only after 17long years, in the form of enactment of the Indian Contract Act in 1872.

The preamble of the act, in a nutshell, gave an idea of what the Act proposed to deal with. It also stated the purpose behind the passing of the Act. It not only delineated the contours of the Act, but also provided the beacon light for the interpretation of the substantive provisions of the Act and the pivotal where the provisions of the Act had scope for more than one interpretation. In a fortnight manner, the preamble of the Act categorically stated the reason behind this legislative effort as being expediency to define and amend certain parts of the law of contracts, for it proclaimed:

 “Whereas it is expedient to define and amend certain parts of the law relating to contracts; it is hereby enacted……..”

“A verbal contract isn’t worth the paper it’s printed on” –  Sam Goldwyn

Written by THE LAWFILE

July 15, 2011 at 12:32 am