Introduction

The case deals with the concept of the validity of a contract. The case also deals with the communication of proposals. It is a landmark judgment decided by the Allahabad High Court.

Facts

• In this case, the defendant’s nephew was absconded and was nowhere found. The defendant had sent all the servants to find his nephew.
• The plaintiff, who was the servant of the defendant, found his nephew accidentally and brought him back.
• As soon as the plaintiff left the house, the defendant announced an award of Rs 501 to anyone who found his nephew, but the plaintiff did not know about the same and after the plaintiff found the missing nephew and brought him back to his home in Kanpur.
• Six months after the said incident occurred, Gauri Dutt sacked the plaintiff.
• After removing from the job, the plaintiff claimed the reward of Rs 501. As a result, the plaintiff Lalman Shukla filed a case against Gauri Dutt, his master, for not rewarding him as he was entitled to.

Issues Involved

• Whether the plaintiff is entitled to get the reward from the defendant?
• Whether is there any valid acceptance given by the plaintiff to the defendant?

Observation

• The court talked about the two essentials with regarding to the contract are considered in this case-
  • To have complete knowledge about the offer or proposal.
  • Acceptance of the offer.
• To have a valid contract there must be some knowledge about the offer to whom the offer is made and the offeree must give his assent or acceptance to the offer.
• As far as the present case is concerned the plaintiff had no knowledge about the offer and didn’t give any acceptance to the offer.
  • Hence the essentials of the valid contract are absent in this case.
• Hence, there is no contract between the parties and the plaintiff is not entitled to get the reward.

Conclusion

The conclusion of the case is that there is no contract if the offeree had no knowledge about the offer and he doesn’t provide any acceptance to the offeror about the offer.

Note

Essentials of a valid contract -

• Section 10 of the Act lays down the following essentials which are required to make an agreement into a valid contract.
  • They are made with free consent.
  • Made between two or more competent parties.
  • Made for lawful consideration.
  • Made with a lawful object.
  • Not expressly declared to be void.
• Some other essentials of a valid contract are:
  • Offer and acceptance.
  • Intention to create a legal obligation.
  • The terms contained in an agreement must not be vague or uncertain.
  • The agreement must be capable of performance.
  • Other legal formalities