Agreement and its Enforcement

Agreement and its Enforcement

Author : Tanya Shrotriya

The role played by two parties for an agreement is a promise from their ends. Promise is the result of an offer made by a person and its acceptance by other. It has been acknowledged by the both parties. Agreement lays the foundation of a contract.      

Promise + Consideration= Agreement.

According to Section 2(e) of Indian Contract Act, 1872, an agreement is every promise and every set of promises, forming the consideration for each other. An agreement is apprehension or positioning between two or more parties. Basically, an offer and acceptance constitute an agreement.

Agreement is the meeting of minds or consensus between two or more major persons mainly about their corresponding rights and obligations regarding past or future performances. The two parties may agree to something through mutual negotiations.

The Golden rule says, “All contracts are agreements but not all agreements are contracts”. For an agreement to change into a contract it must lead to legal obligations or to simply put it must be within the scope of law. For example, Riya decides to sell Harman a unicorn in exchange of twelve precious stones. Can this be a contract? Obviously, no.

To sum up Contract = Agreement + Enforceable by law. Agreement has a wide scope. It is not necessary to have an agreement in writing.

There are many types of agreements; on the grounds of enforceability agreement has two types –

1. Valid Agreement:

 An agreement written or expressed among two parties to provide facility or resource. Section 2(h) of Indian Contract Act, 1872 says an agreement enforceable by law is a contract.

2. Void Agreement:

An agreement which is null from its establishment and no rights can arise to any party or the transferee (void ab intio). Section 2(g) of Indian Contract, 1872 tells an agreement not enforceable by law is said to be void.

Agreements those are void –

a) Agreement without consideration (Sec.25)

b) Agreement in restraint of marriage (Sec.26)

c) Agreement in Restraint of trade (Sec.27)

d)Agreement in Restraint to Legal Proceedings (Sec.28)

e) Uncertain Agreements (Sec.29)

f) Wagering Agreements (Sec.30)

Another type of agreement that does not fit into above two categories is Illegal Agreement. It is that the law forbids the very act, the doing of which is contemplated by the agreement. For example, an agreement to commit a crime.

To conclude, Agreement can be moral and may not be enforceable by law. It must be socially acceptable. Agreement defines the roles and responsibilities of the parties. Legal recognition of an agreement, in contract law, is only given where a contract can be said to have been established between the parties to an agreement.