AN ASSIGNMENT ON BUS 301: LEGAL ASPECTS OF BUSINESS

AN ASSIGNMENT

 ON

BUS 301: LEGAL ASPECTS OF BUSINESS

(THE GLOSSERY ON THE WHOLE SYLLABUS)

   PREPARED FOR

MD. MAMUN UR RASHID

LECTURER & COURSE TEACHER

DEPARTMENT OF BUSINESS ADMINISTRATION

  

PREPARED BY

NAME:Md. Sojibur Rahman

DEPARTMENT OF BUSINESS ADMINISTRATION

MANARAT INTERNATIONAL UNIVERSITY, DHAKA-1212

 July, 2011

Law of contract

Contract:

An agreement enforceable by law is a contract. Therefore in a contract there must (1) an agreement and (2) the agreement must be enforceable by law.

An agreement comes into existences whenever one or more persons promise to one or others, to do or not to do something, “every promise and every set of promises, forming the consideration for each other, is an agreement – sec 2(e).

The Essential Elements of a Contract:

An agreement becomes enforceable by law when it fulfills certain conditions. These conditions, which may be called the Essential Elements of a contact. These are

1)       The essential elements must be a lawful offer by one party and lawful acceptance of the offer by the other party or parties.

2)       The essential elements must be an intention (among the parties) that the agreements shall result in or create legal relations.

3)       In the lawful consideration subject to certain exceptions, an agreement is legally only when each of the parties to it gives something and gets something.

4)       The parties to an agreement must be legally capable of entering into an agreement; otherwise it cannot be enforced by a court of a law.

5)       An agreement must be based on free consent of all the parties.

6)       The object for which the agreement has been entered into must not be illegal, immoral, or opposed to public policy.

7)       The certainty of an agreement must not be vague.

8)        The agreement must be capable of being performed.

9)       An agreement so made must not have been expressly declared to be void.

10)   An oral contract is a good contract but writing and registration is required by some statute.

The elements mentioned above must all be present. If any one of them absent the agreement does not become a contract. From this it follows that “every contract is an agreements but all agreements are not contract ’’

Offer and acceptance

Offer:

An “offer ’’ involves the making of a “proposal’’. The proposal is defined in the contract act as follows:

“When one person signifies to another his willingness to do or to abstain from doing anything, with a view to obtaining the assent of that other to such act or abstinence ’’. – Sec 2(a)

A proposal is also called an offer. The promise or the person making the offer is called the offeror. The person to whom the offer is made is called the offered.

Rules Regarding Offer:

The contract act contains various rules regarding offeror proposal. These are:

1)       An offer may be express or may be implied from the circumstances such as by words, spoken or written and by conduct.

2)        An offer may be made to a definite person, to some definite lass of persons, or the world at a large.

3)       The offer must be one which is capable of creating a legal relationship.

4)       The terms of the offer must be certain, definite, unambiguous and not vague.

5)       A mere statement of intention is not an offer.

6)       An offer may be made subject to conditions.

Acceptance:

An offer can be accepted only by the person or persons for whom the offer is intended. An offer made to a particular person can only be accepted by him because e is the only person intended to accept .an offer made to a class of persons can accepted by any member of that class.

Rules Regarding Acceptance:

The acceptance of an offer to be legally effective must satisfy the following requirements:

1)       The acceptance must be an absolute and unqualified acceptance of all the terms of the offer.

2)       In the rules regarding the acceptance must be conditional.

3)       In the acceptance contracts subjects to condition.

4)       The seeking clarification of offer neither amounts to the acceptance of the offer nor the making of counter offer.

5)        The acceptance must be expressed in some or reasonable manner such as – oral writing or by conduct.

6)       Mental acceptance or excommunicated assent does not result in a contract acceptance cannot be implied from silence of the offering.

7)       The promissory prescribes a particular mode of acceptance.

8)       The offeror prescribes a time; the acceptance must be done within that time. If no time is prescribed the acceptance must be done within reasonable time.

9)        An acceptance is complete when it comes to the knowledge of the propose.

10)   Acceptance must be given before the offer, this is the natural sequence.

11)   The acceptance must be made while the offer is in force.

Revocation of an Offer:

An offer comes to an end and is no longer open to acceptance under the following circumstances,-sec 6

1) By notice:

If the offeror gives notice of revocation o the other party, expressly withdraws the offer and the

Offer comes to an end.                                         

2) By lapse of time:

When the proposer prescribes a time within which the proposal must be accepted, the Proposal Lapse as soon as the time expires.

3) After expiry of reasonable time:

If no time has been prescribed, the proposal lapses after the expiry of a reasonable time.

4) By failure of a condition precedent:

An offer lapses by the failure of the acceptor to fulfill a condition precedent to acceptance.

5) By death or insanity:

An offer lapses by the death or insanity of the proposer.

6) Counter offer:

When a counter offer is given, the original offer lapse.

7) By refusal:

A proposal once refused is dead and cannot be revived by its subsequent acceptance.

Consideration

Consideration:

Sec 2(d) of the contract act defines consideration as follows: “when at the desire of the promisor , the promisor or any other person has done or abstained from doing , or does or abstains from doing  something , such act or abstinence or promise is called a consideration .’’

Rules of Consideration:

The following rules may be laid down regarding consideration:

  1) Desire or request of the promisor is essential in consideration.

  2) The consideration must real in the eye of law.

  3) The promise is already under an existing public duty, an express promise to perform that duty will not .

  4) A promise made to a stranger to perform an existing contract.

  5) Consideration need not be adequate.

  6) The consideration must not be illegal, immoral, or opposed to public policy.

  7) The consideration may be present, past, or future.

  8) Consideration may move from the promise or from any other person.

Good Consideration:

A good consideration is that one which fulfills the essential element of a consideration as far law Contract. Subject to the essential factor

A good consideration can be any of the following:

  1) Physical good

  2) Services

  3) Forbearance

  4) Arbitration or the compromise of dispute climes

  5) Settlement or composition with creditors “No consideration no contract” _ exception to the rule

There are exceptional cases where a contract is enforceable even though there is no consideration. They are as follows:

  1) Natural love and affection

  2) Voluntary compensation

  3) Time barred debt

  4) Agency

  5) Completed gift

Void and Void able Agreements

Void Agreement

"An agreement not enforceable by taw is said to be void. ­Sec: 2(g). A void agreement has no legal effect. It confers no rights on any person and creates no obligations.

Agreements which become void: 

An agreement, which was legal' and enforceable when it was` entered. Into, may subsequently become-void due to impossibility of performance, change of taw or other reasons. When it becomes. Void the agreement ceases to have Legal effect. There are certain agreements which are expressly declared to be void even though they may otherwise satisfy Sec.10 of the, Indian contract Act. (i.e. ^-would 'have 'been otherwise enforceable contracts). , They as follows,

1)       Section^- 26 of the Contract Act provides that every agree­ment in restraint of the. Marriage of any. Person, other than a; minor is void.

2)       Section 27 of the Act states that every agreement -by which anyone- is restrained' from exercising a 'lawful profession, trade or business' of any 'kind, is to that extent void.

3)       According to Section '28 'of the Act Private Individuals cannot y agreement g1ter or vary their personal law or the' Statute law.

4)       Section 29 implies that, agreements, the meaning, of which is not certain, or capable of, being made certain are void.

5)       Section; 30 of the Contract Act clearly states that_. Agreements by way of wages are void.

6)       Section S6 (1) provides that agreements to do an act Impos­sible in itself are void.

7)       Section 24, 57 and 58 -maintain that agreements whose objects or considerations are unlawful are void.

Voidable Agreement

A voidable agreement is one which can be avoided, i.e., set aside by some of the parties to it. Until it is avoided, it is a good contract. "An agreement which is enforceable by taw at the option of one or more of the parties thereto, but not at the option of the other or .others, is a voidable contract."-Sec. 2(i)

Distinction between it Void Agreement and aim Illegal Agreement

An illegal agreement is also void. But ~a void agreement is not necessarily illegal. An agreement may not be contrary, to taw but may still be void. An: agreement, the terms of which are uncertain, is void but such a contract is not illegal. When an agreement is illegal, other agreements which are incidental or collateral to it are void. The reason, underlying this rule is that the courts will not enforce any agreement entered into with the object of assisting or. Promoting an illegal trans-_. Action. If the main agreement is void, (but not illegal) agreements which are incidental or collateral to it may be valid.

Capacity of parties

Definition of Capacity:                                                                                                                                                                                                                                                                                                                 

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 disqualified from contracting by any law to which he is

Subject.

From Section 11 it follows that a person is incapable of entering into contracts under the following    circumstances:
  (i) if he has not attained the age of majority according to the law to which he is subject.

  (ii) If he is not of sound mind (if he is a lunatic or an idiot or suffering form s similar disability)

  (iii) If he is disqualified form contracting by any law to which he is subject.

The Law Regarding Minor’s Agreement:

The low regarding agreements by minors may be summarized as follows:

  1) Minor’s Agreement is Void

  2) A minor can be a promis

  3) Minor’s Liability for Necessaries

  4) Law regarding  Compensation or Restitution

  5) No Estoppels

  6) No Ratification

  7) No specific performance

  8) No insolvency

  9) Partnership by minor

  10) A minor can be an agent

  11) Position of minor’s guardian

  12) A company shares of a minor

Persons of Unsound Mind:

1)      Illustrations

2)      Idiocy

3)      Lunacy or Insanity

4)      Drunkenness

5)      Effects of Agreements made by persons of Unsound Mind

                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  

Disqualified Persons:

Aliens

1.       Foreign sovereigns

2.       Company and Corporation

3.       Professional Persons

4.       Women

Free consent

 

Free consent

An agreement valid only when it is the result of the “free consent” of all the parties to it. Section 13 of the Act defines the meaning of the term “consent” and section 14 specifies under what circumstances consent is “free”.

Consent is not free if it is caused by – 1) Coercion

                                                        2) Undue influence

                                                        3) Fraud

                                                        4) Misrepresentation

                                                        5) Mistake

Coercion:

Coercion is the committing or threatening to commit, any act forbidden by the Indian Penal Code, or unlawful detaining or threatening to detain, any property, to the prejudice of any person whatever with the intention of causing any person to enter into an agreement.

Features of Requisites:

 The provisions of Section 15 can be analyzed as follows:

1)       Coercion means (I) committing or threatening to commit an act forbidden by the Indian Penal Code (ii) the unlawful detaining or threatening to detaining property.

2)       The act, constituting coercion, must be directed at any person and not necessity at the other party to the agreement.

3)       The act, constituting coercion, must have been done or threatened with the intention of causing any person to enter into an agreement.

4)       It does not matter whether the Indian Penal Code is or is not in force in the place where the coercion is employed.

Example: A girl of 13 was made to agree to adopt a boy by her husband’s relative who prevented the removal of the dead body of her husband until she consented to the adoption. Held, the agreement to adopt was not binding.

Undue Influence:

 A contract is said to be induced by undue influence where (i) one of the parties is in a position to dominate the will of the other and (ii) he uses the position to obtain an unfair advantage over the other.-Sec-16 (1)

·         Presumption:

 Where one party holds a real or apparent authority over the other or where he stands in a fiduciary relationship to the other.

Where a party makes a contract with a person whose mental capacity is temporarily or permanently affected by reason of age, illness or mental or bodily distress.

Example: F having advanced money to his son B during his minority, upon B’s coming of age obtains by misuse of parental influence, a bond from B for a greater amount than the sum advanced. F employs undue influence

Misrepresentation:

Misrepresentation arises when the representation made is inaccurate but the inaccuracy is not due to any desire to defraud the other party. There are no intentions to deceive.

1)       Unwarranted Assertion: The positive assertion, in a manner not warranted by the information of the person making it, of that which is not true, though he believes it to be true.

2)       Breach of Duty: Any breach of duty which , without an intent to deceive, gains an advantage to the persons committing it, or anyone claiming under him, by misleading another to his prejudice.

3)       Innocent Mistake: Causing however innocently a party to an agreement to make a mistake as to the substance of the thing which is the subject of the agreement.

Fraud:

The term fraud includes all acts committed by a person with a view to deceive another person.

            Section 17 of the Contract Act states that “Fraud” means and includes any of the following acts:

1.       False statement

2.       Active Concealment

Example: B having discovered a vein of ore on the estate of A, adopts means to conceal and does conceal, the existence of the ore from A, through A’s ignorance B is enabled to buy the estate at an undervalue, the contract is voidable at the option of A.

3.       Intentional non-performance

4.       Deception

5.       Fraudulent act or omission

Conditions:

1)       The act must have been committed by a party to a contract or with his connivance or by his agent.

2)       The act must have been done with the intention to deceive and must actually deceive.

3)       The consent of the party was obtained by the act complained of.

4)       In cases of fraudulent silence, the contract is not voidable if the party whose consent was so caused had the means of discovering the truth ordinary diligence.

5)       The remedy of rescinding the agreement is not available in cases of approbation and undue delay in taking action.

Distinction between Fraud and Misrepresentation:

1.       Different Intention

2.       Different Belief

3.       Different Rights

4.       Different Defense

Mistake: Mistake may be defined as an enormous belief concerning something.

Classification: 

        I.            Mistake of law

      II.            Mistake of fact

a)       Mistake as to a law in force in India

b)       Mistake as to a law not in force in India.

UNLAWFUL CONSIDERATION AND OBJECT

Definition:

An agreement will not be enforced by the court is called unlawful agreement.

Unlawful Agreements:

According to Section 23 of the Act the consideration and the object of an agreement are unlawful in the

Following cases:

1.       If the object of an agreement or the consideration is doing of an act is forbidden by law, the agreement is void.

2.         If the object of an agreement or the consideration is of such a nature that it would indirectly lead to a violation of the law, the agreement is void.

3.          An agreement whose object is to defraud others is void.

4.       If the object of an agreement or the consideration is to injure the person or property of another, it is void.

5.          An agreement whose object is immoral, or where the consideration is immoral, is void.

6.       An agreement which is injurious to the public or against the interests of the society is said to be opposed to public policy. 

Wagering agreements

A wager is an agreement by which money is payable by one person to another on the happening or non-happening of a future uncertain event

.

Characteristics of wagering agreement:

   1. The consideration for the promise under a wagering agreement is to pay or get money.

   2. The money is payable on the happening or the non-happening of an event.

   3. The agreement depends on a future and uncertain event.

   4. The essence of gaming and wagering is that one party is to win and the other lose.

   5. In wagering agreement no party has control over the event.

   6. Commercial transactions are valid, but to pay price differences in a wagering    agreement is void.

                                                                                          

Exceptions:

                 1. Shares

                 2. Games of skill

                 3. A statutory exception

                 4. Contract of Insurance

                 5. Badla 

Termination or Discharge of Contracts

Termination by mutual agreement:

By agreement of all parties a contract may be cancelled or its terms altered or a new agreement substituted for it. When ever any of these things happen, the old contract is terminated. “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.”

Termination by mutual agreement may occur in any one of the following ways.

1.       Novation

2.       Alteration

3.       Remission

4.       Accord and Satisfaction

5.       Rescission

6.       Waiver

7.       Merger

Subsequent or Supervening Impossibility:

Pre-contractual Impossibility:

 A contract which at the time it was entered into was impossible to perform, is void creates no rights and obligations, e.g. a promise to ride a horse to the sun.

Post-contractual Impossibility:

A contract to do an act which, after the contract is made, becomes impossible, or, by reason of some event which the promisor could not prevent, unlawful, becomes impossible or an unlawful.

Grounds of frustration supervening impossibility may occur in many ways, some of which are explained below:

1. Destruction of an object
2. Change of law
3. Failure of Pre-conditions
4. Death or Incapacity for personal services
5. Outbreak of war

Termination by Breach of contract:

When a contract is broken by one party, the other party or parties are freed from the obligation of performing the contract. They can also take the remedial measures to which they are entitled.

Breach of contract may arise in two ways:

1. By anticipatory breach
2. By actual breach or present breach

1.  Anticipatory Breach of Contract:

Anticipatory breach of contract occurs when a party repudiates his liability under the contract before the time for performance is due or when a party by his own act disables himself from performing the contract.

2.  Actual Breach of Contract:

Actual breach of contract occurs when during the performance of the contract or at the time when the performance of the contract is due, one party either fails or refuses to perform his obligations under the contract.

Remedies of Breach of Contract:

1. Rescission of the contract
2. Suit for damages
3. Suit upon quantum meruit
4. Specific performance of the contract
5. Injunction

    

Sales of goods act

Sale

A contract for the sale of goods may be either a sale or an agreement to sell (Sec. 4).Where under a contract of sale the property in the goods (i.e.; the ownership) is transferred from the seller to the buyer the contract is called a sale.

“P agrees to buy a quantity of soda to arrive by a certain ship from Q”. This is an agreement to sell because the property in the goods will pass to the buyer when the goods come & the agreement is naturally subject to the condition that the ship arrives in port with the goods.

Agreement to sell

When the transfer of ownership is to take place at a future time or subject to some condition to be fulfilled later, the contract is called an agreement to sell.

Distinction between a sale & an agreement to sell

1. Transfer of ownership
2. Transfer of risk
3. Remedial measures
4. nature of contract

The essential elements for the sale of goods

“Members of a club or voluntary society are individual joint owners not part-owners. Therefore payment of cost for food by any member is not a sale”.

Two parties

Science a contract of sale involves a change of ownership; it follows that the buyer & the seller must be different persons.

The other essential elements of a contract for the sale of goods are given below:

1. Movable goods
2. Movable goods for money
3. Formation of the contract of sale

4. Method of forming the contract
5. The terms of contract

Condition

A condition is a stipulation essential to the main purpose of contract, the breach of which gives rise to a right to treat the contract as repudiated.

Warranty

A warranty is a stipulation collateral to the main purpose of the  contract, the breach of which gives rise to a claim for damages but not a right to reject the goods & treat the contract as repudiated.

“Certain goods were promise to be delivered on 1^st June, time being made essence of the contract. The goods were delivered on 2^nd June”. The buyer may accept the goods.

1. Compulsory waiver of a condition

Where a contract of sale is not severable & the buyer has accepted the goods or a part thereof, he cannot repudiate the contract but can only sue for damages.

The other one is-

2. Voluntary waiver of a condition

The distinction between condition & warranty

Contract		Warranty
Condition is a term which is essential to the main purpose of the contract.	1	Warranty is only a collateral term. It is subsidiary to the main purpose pf the contract.
Breach of a condition gives the aggrieved party a right to repudiate the contract.	2	Breach of warranty entitles the aggrieved party to claim damages only.
A breach of condition may under certain circumstances, be treated as a warranty.	3	A warranty cannot become a condition.

Negotiable Instrument

Definition:

“Negotiable” means transferable by delivery and “instrument” means a written document by which a right is created in favors of some person. The term negotiable instrument literally means “a document transferable by delivery”.

Promissory Note:

“A promissory note is an instrument in writing containing an unconditional undertaking signed by the maker, to pay a certain sum of money only to order of a certain person, or to the bearer of the instrument”

Essential Elements:

1. The instrument must be in writing
2. The instrument must be signed by the maker of it.
3. The instrument must contain a promise to pay.
4. The promise to pay must be unconditional..

Differences Between a promissory note and a bill of exchange:

1. Number of parties
2. Promise and order
3. Acceptance
4. Liability
5. Relationship
6. N
7. Protest

Rights of a holder in due course:

1. Defects of instrument are eliminated
2. Unauthorized acts of an agents may be valid
3. Good title in an inchoate stamped instrument
4. Liability of prior parties to holder in due course
5. Holder can file a suit in his own name
6. Acceptance of bill drawn in fictitious name
7. Unlawful instruments
8. Estoppels against denying original validity of instrument
9. Estoppels against denying capacity of payee to indorse
10.  Transferee from a holder in due course                                         

  

Bill of   Acceptance

A bill of exchange is said to be accepted when the drawer puts his signature on it, thereby acknowledging his liability under the bill.

When presentment for acceptance is not necessary:

1. When after a reasonable search the drawer can not be found
2. When the drawer is insolvent or dread
3. When the bill is drawn on a non-existing or fictitious person or on a person who is incapable of entering into contracts.

Who can accept a bill?

1. The drawer of the bill
2. The drawer in case of need
3. The legal representative, when the drawer is dead.
4. The official assignee or official receiver, when the drawer has become involvement.
5. Acceptance by several drawers not partners
6. A bill may be accepted by a person for the honor of the drawer. This is known as acceptance for honor.

“Once a bearer instrument always a bearer instrument”:

If a negotiable instruments endorsed in blank or is payable to bearer, it is a bearer instrument. The holder of such instrument may negotiate it by delivery only. But support that the holder indorses it especially to a person and makes it payable to the order of such person. In such a case indorse in full cannot be sued by any person except the person in whose favor he indorsed it, but as regards all parties prior  the indorse in full. The instrument remains transferable by delivery.

Company and partnership

Difference between the private Ltd co. and public Ltd co.

The main points of difference between the 2 types of companies are enumerated bellow:

1. Number of members: The number of members in a private company can’t be less than 2 & can’t be more than 50.  
2. Restrictions on transfer of shares: In a private company here must be regulations, restricting the transfer of shares.
3. Restriction on invitation to public: A private company "Cannot invite the public to purchase its shares or debentures.
4. Restriction on name: A private company must add the words, "Private Limited" at the end of its name.-Sec. 13.
5. Prospectus: A private company need not file a prospectus 'or a statement in lieu of prospect us.-Sec.70 (3).
6. Issue of rights shares: When a public company proposes increase its subscribed capital by the issue of new shares, it must be offered first to the existing equity shareholders pro rata, unless the members in a general meeting decide otherwise.
7. Commencement of business: A private company can commence business immediately on incorporation, whereas a public company has to wait until it obtains a certificate for the Commencement of Business.-Sec. 149(7).
8. Statutory Meeting and Statutory Report: A private company need not hold the Statutory Meeting or file the Statutory Report.-Sec. 165(l 0).
9. Managerial Remuneration: In the case of public companies there are certain limits to managerial remuneration. This rule does not apply to a private company which is not a subsidiary of a public company.-Sec. 189.
10. Number of directors: The Act provides that a private YV company must have at least 2 directors and a public company at least 3 directors.-Sec. 232.

Partnership

“Partnership is the relation between persons who have agreed to share the profits of a business carried on by all or any of them acting for all”.

Who can be a partner?

1. Person: Under the Indian Partnership Act, a person may be partner if he has the capacity to enter into a contract.
2. Minor: A minor cannot be a partner.
3. Person of unsound mind: A person who is of unsound mind cannot become a partner.
4. Women: A women can be a partner, married or unmarried.
5. Company: In a company the capacity to enter into contract is determined by the Memorandum and Articles of the Association of the company.
6. An alien enemy cannot enter into a contract of partnership with a citizen of India.

  Dormant partner

These partners join the firm by agreement but do not take any active part in the business. Their liabilities are same as of active partners.

Minor admitted as a partner

A minor cannot enter into a contract of partnership because an agreement by a minor is void.

The rights and liabilities of such a minor partner are governed by the following rules:

1. The minor has a right to such share of the property and of the profits of the firm as may be agreed upon by the partners.
2. The minor may have access to and inspect and copy any of the accounts of the firm.
3. The share of the minor in the profits and in the assets of the firm are liable for the acts of the firm but the minor is not personally liable for any such act.
4. So long as the minor continues to be a member of the firm, he cannot file a suit against the other partners for an account or for the payment of his share of the property or profits of the firm.
5. At any time within six months of his attaining majority.
6. The following rules apply when a minor elects to become a partner or becomes a partner by failing to notify otherwise:

a)       His rights and liabilities as a minor continue up to the date on which he becomes a partner, but he also becomes personally liable to third parties for all acts of the firm done since he was admitted to the benefits of partnership.

b)       His share in the property and profit of the firm shall be the share to which he was entitled as a minor.  

7. The following rules apply when the minor  elects not to become a partner:

a)       His rights and liabilities continue to be those of a minor up to the date on which he gives public notice.

b)       His share is not liable for any acts of the firm done after the date of the notice.

c)       He is entitled to use the partners for his share of the property and profits of the firm.

                                                               

The law relating carriage act

Carrier:

Any person or an organization, by an express or implied contract, with or without remuneration, carries goods and a passenger is called a carrier.

Is the post office is a common carrier:

The post office is not a common carrier. It is not an agent of the sender to deliver a postal article to the addressee. It is really a branch of the public services providing postal services subject to the provisions of the post office act and the rule made there under.

Characteristics of a common carrier:

The characteristics of a common carrier in Indian are as follows:

1. It may be a firm or an individual or a company. The post office is not a common carrier, although it may carry goods.
2. Only carries of goods come within the definition. A carrier of passengers is not a common carrier.
3. A common carrier is one who carries goods for business and money. From this it follows who carries goods occasionally is not a common carrier.
4. A common carrier is one who is ready to carry the goods of any person without any discrimination

Difference between the private and public carrier:

 1. A common carrier is one whose business is carriage of goods for hire. A private carrier is an occasional   carrier.

2.   A common carrier is bound to carry the goods of any person who is ready to pay the usual freight, provide certain condition are fulfilled .A private is free to carry the goods or not as he please.

3. The liabilities of a common carrier are determined by the common carriers Act, 1865. A private carrier is not governed by this Act. His position is that of a bailed.

Duties of a common carrier:

The duties of a common carrier in India are determined by the common carriers Act and (as regards points not covered by this Act) by the rule of English law. The duties can be summed up as follows:

1. Must carry goods without discrimination

A common carrier is bound to carry the goods of every person, without any distinction. But certain exceptions are recognized. A common carrier can refuse to carry under the following circumstances:

               (A) if the customer is not willing to pay reasonable charges for the carriage;

               (b) If there is no accommodation in the carriage;

               (c) If the goods are dangerous or are of a type which the carrier is not

                    Accustomed to carry; and

             (d) If the goods are to be carried over a route with which the carrier is not

                  Familiar

2. within time ant at the place

The carrier must deliver the goods at the agreed time or within a reasonable time. The place of delivery is subject to contract.

3. with safety

The goods must be carried with reasonable precaution for their safety and over the usual and ordinary route.

4. Must insure

According to English common low a common carrier of goods is an insurer, i.e., he is bound to indemnify the owner in full for loss or damage to the goods in course of carriage. This liability is to subject to certain exceptions. There is no decision on the Supreme Court of India yet.

6. without deviations

Deviations are not permitted unless rendered necessary by exceptional circumstances.

The liabilities of a common carrier

English law

According to English common law a common carrier of goods is an insurer, i. e., he is bound to indemnify the owner in full for any loss or damage to the goods in course of carriage. This rule of full liability is subject to certain exceptions. The carrier in not liable in the following cases:

(a)     When damage is caused by an Act of God, by which is meant a natural calamity like a storm or earthquake?

(b)     When damage is caused by the enemies of the state, e. g., during wars.

(c)     When damage is caused by some inherent defect in the goods or negligence of the consignor.

(d)     When there is a special agreement limiting the liability of the carrier.

(e)     There is no liability for damage caused after the goods arrive at their destination. 

Indian law

The liabilities of a common carrier of goods in Indian are laid down in the common carriers Act of 1865. This Act divides goods into two categories: scheduled and non-scheduled.

Rules: The rules regarding the liability of common carriers in India are summarized below:

1. For scheduled articles exceeding Rs. 100 in value, the carrier is liable for all loss and damage.

(a)     If the value and the description of the goods are disclosed by the consignor to the goods  to the carrier, or

(b)     If the loss or damage is due to a criminal act of the carrier, his agent or servant

2. The common carrier can charge extra for carrying scheduled articles but can not limit his statutory liability by any special agreement.
3. The liability of a common carrier can be limited by agreement under the provision of sections 6 and 8 but that there must be a limitation of the liability .M.G. Brother lorry Services v. Prasad Textile.
4. The common carrier is responsible for loss or damage caused by negligence of criminal acts done by himself , his agent or servant .Bunter knitting Works Ltd .v. St. Johns Garage .(see p. 1680
5. In case of loss or damage, the claimant must notify the carrier within six month of the date of knowledge of the loss or damage.
6. The rules apply only to common carrier as defined by the common carrier Act of 1865.Thus; they do not apply to carrier of passenger or to railway.
7. Measure of damages; the measure of damages for delay for goods lost or damaged, is the difference between the value of the goods at the time when they ought to have been delivered and at the time when they were actually delivered.  Wilson v. Lancashire and Yorkshire Railway co.

Charter party:                                                                                                                                                 A Charter-Party may be defined as an agreement in writing for the purpose of hiring an entire and ship or a part thereof for the purpose of carriage of good. The person hiring the ship or a part of it is called the chartered.

Classification:                                                                                                                                                                       The following types of charter-party are found:

1. A charter-party for a particular period of time is called a time Charter

2. A Charter-party for a particular voyage is called a voyage charter.

The clauses in a charter-party usually deal with the following matters:

1. Name of the parties and of the ship.

2. Nationality of the ship.

3. The ship owners guarantee of fitness.

The bill of leading

A Bill of Lading is a receipt for good delivered to a ship for carriage. A bill of lading is used when the good shipped form only a part of the cargo of the ship Characteristics:

A bill of lading has the following Characteristics:

1. Signature: It is signed by the ship owners or his agent.

2. Evidence: The bill of lading is evidence of the contract for the carriage of goods. Some of the terms may be written down on the bill of lading. Lading used form an Indian port:

A. the number of packages or pieces or the quantity or weight as furnished by the shipper, and 

B.the apparent order and condition of the goods.

3. Acknowledgement: The bill of lading is prima facie evidence of the receipt of the goods by the carr      

The Payment of Wages Act

Wages

Wages means all remuneration payable to an employed person on the fulfillment of his contract of employment.

The subject matters that do not include in the wages are given below:

• The value of house-accommodation, supply of light, water, medical attendance, or other amenity or any service excluded by the President or the Government.
• The employer’s contribution to a pension or provident fund;
• Traveling allowance or concession or other special expenses entailed by the employment;
• Any gratuity payable on discharge.

Works man compensation act

Minor

Means a person who has not attained the age of 18 years. Sec-2

Partial disablement

 Means where the disablement is of temporary nature, such disbursement as reduces the earning    capacity of a worker in any employment in which he was engaged at the time of the accident resulting in the disablement.

Dependant

In relation to a deceased worker, means a widow, minor child unmarried daughter or widowed mother.

Employer  In relation to an establishment, means any person who employs workers therein & includes-

a)       an heir successor, assign guardian or legal representative, as the case may be such person

b)       any manager or person responsible for the management and control of the establishment

Total disablement

Means such disablement, whether of a temporary or permanent nature, as incapacitates a worker for all work which he was capable of performing at the time of the accident resulting in such disablement

Workman

The definition of the term workman is important because only a person coming within the definition is entitled to the reliefs provided by the works man compensation act.

When employer is is liable to pay compensation?

Sec 3(1) lays down that if personal injury is caused to a work man by accident arising out of and in curse of employment, his employer shall be liable to pay compensation.

 From the above it follows that the employer is liable when

a)       injury is caused to a workman by accident

b)       the accident arises out of and in course of employment

Determine the amount of compensation

          For determining the amount of compensation payable under the act

1)       death

2)       permanent total disablement

3)       permanent partial disablement

4)       temporary disablement

Employment of contractors (sec 12)

When an employer engages contractors who engage workman any workman injured may recover compensation from the employer if the condition is satisfied

a)       The contractor is engaged to do a work which is par of the trade of the principle

b)       The engagement is the course of or for purposes of his trade or business, and

c)       The accident occurred in or about the vicinity of the employer’s premises.

Factories act (1965)

Manufacturing process

means making, alerting, repairing, ornamenting, painting, washing, packing,   finishing, or otherwise treating any articles or substance with a view to its use, sale, transport, delivery, display or disposal.

Shift

 Means where work of the same and kind is carried out by two or more sets of workers working during different periods of the day, each of such periods

Relay

Means where work of the same kind is carried out by to or more sets of workers working during different periods of the day, each of such sets.

Adult

 Means a person who has completed his eighteenth year of age. Sec -2(a)

Adolescent

 Means a person who has completed his fifteenth year of age but has not completed his eighteenth year. Sec _ 2(b)

The rules regarding health & hygiene

              As per sec _

1)       disposal of waste and effluents sec(12)

2)       dust and fume sec (14)

3)       overcoming sec (16)

4)       spittoons sec (20)

The rules regarding safety

                  As per sec-

1)       work on or near machinery in motion (22)

2)       self-acting machines (25)

3)       pressure plant (31)

4)       power to make rules to supplement this chapter (42)

  The rules regarding welfare workers

                   As per sec –

1)       first aid appliance sec (45)

2)        shelters , rest rooms and lunch rooms sec(47)

.Industrial relation ordinance 1969

 In relation to an establishment means any person or body of persons. Whether incorporated or not, who or which employees workmen in the establishment under a contract of employment.

Industrial dispute:

Means any dispute or difference between employers and employers or between employers and workmen or between workmen and workmen. This is connected with the employment or non employment or the terms of employment or the conditions or work of any person;

Lock-out:

The closing of a place of employment or part of such place of the suspension. Wholly or partly or work by an employer or refusal absolute or conditional. By an employer to continue to employ any number of workmen employed by him where such closing. Suspension or refusal occurs in connection with an industrial dispute or is intended for the purpose of compelling workmen employed to accept certain terms and conditions of or affecting employment

Strike:

Means cessation of work by a body of persons employed in any establishment acting in combination or a concerted refusal or refusal under a common understanding  or any number of person who are pr have been so employed to continue to work or to accept employment.

Trade union:

Means any combination of workmen or employers formed primarily for the purpose of regulating the relation between workmen and employers or for imposing restrictive conditions on the conduct or any trade or business and includes a federation of two or more trade unions.