It may be classified from the following point of view:-
(A) On the basis of enforcement
(i) Valid Contract.-“An agreement enforceable by the law is a contract” [Section 2(h)]. Section 10 lays down the conditions of enforceability.
(ii) Voidable Contract.-“An agreement which is enforceable by law at the option of one or more of the parties thereto, but not at the option of the other, is a voidable contract” [Section 2(i)].
(iii) Void Contract.– “ A contract which ceases to be enforceable by the law becomes void when it ceases to be enforceable” [Section 2(j)]. In this case contract is valid when made but subsequently becomes void due to certain circumstances.
(iv) Unenforceable Contract.- It is one which is good in substance, but because of some technical defect, one or both of parties cannot be sued on it. These defect may be absence of writing, registration, time-barred by law of limitation, etc.
(v) Illegal/unlawful Contract.– Section 23 describes some condition’s when an agreement may be unlawful or illegal. These may be agreements, whose object or consideration is forbidden by law, or of such a nature that if void ab initio. All illegal agreements or contracts are void, but all void agreements are not illegal.
(B) On the basis of mode of creation
(i) Express Contract.- According to Section 9 “insofar as the proposal or acceptance of any promise is made in words, the promise is said to be express”. Contracts entered into between the parties by words, spoken or written, are known as express contracts.
(ii) Implies Contract.– According to Section 9, “insofar as such proposal or acceptance is made otherwise then in words, the promise is said to be implies.”
(iii) Quasi-contract.- Contract which does not arise by virtue of any agreement between the parties, but due to certain special circumstances, law recognizes it as a contract.
(C) On the basis of extend of execution
(i) Executed Contract.- When both the parties have completely performed their respective obligations under the contract, it is said to be executed contract. Examples.-when a medicine seller sells medicine on cash payment.
(ii) Executory Contract.- An executory contract is one which is one in which one or both parties are still to perform their obligations. Such controls are future contracts. For example.- Delivery and payment are to be made after 15 days. The contract is executory.
(iii) Unilateral Contract.– In this contract one party has performed his part at a time of formation and obligation is outstanding only against other.
(iv) Unilateral Contract.– Here both parties are outstanding at the time of formation of the contract. In such case, each party is a promisor and promise.
By – Shradha Arora
(Editor @ Legal Bites)