Construction Contract Easy Understanding @ Part 1

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Did you know?

In day-today life we enter into some kind of contracts in one or the other way in the form of Promises, agreement, deal and so on. Like we purchase vegetables, foods, grocery etc and in return we pay in the form of money, exchange of goods agreed etc.

Let's know more about a contract..

1.What is a contract?

A contract is an agreement entered between the competent parties with free consent and having a lawful consideration and it must be enforceable by law at the time being. It must not be impossible to perform and should not conflict the law and any public policy.

2. A valid contract must have an offer and acceptance in the manner as mentioned in the offer.

3. A contract without consideration are void except some cases like Gifts, Paying the debts of other by doing something.

4. Handwritten or type-written words prevail over printed words in the terms of a contract. Because written words are immediate language that a person wants to express in the terms of a contract.

5. Ordinary and natural meaning of a word prevails in a contract even if such meaning was not intended for in the context of that term. However court may modify it's meaning up-to the extent necessary, if such ordinary meaning absurd the rest of the contract.

6. Technical terms in a contract will be construed to its technical sense unless there is strong indication in the contract that the contrary was intended for.

7. Reasonable and Favourable meaning. When the terms of a contract are ambiguous and one interpretation is leading to unreasonable results, the court will not adopt that interpretation. The court in such situation will try to find out the real intention of the parties to give a reasonable and favourable meaning consistently with the rules of law. Example : An employer argued on the interpretation of the contract , that the contractor was bound to complete the work in time even though extras were ordered. This interpretation was rejected by the court stating unreasonable interpretation. It is obvious that if extras will be ordered time extension shall be granted.

8.Words Versus Figures. In case of any discrepancy between the words and figures appearing in a contract agreement, the words will prevail.

9. Deleted words and Alterations. Deletions made before the contract is signed are not considered and alterations made before signing the contract are binding. The contract is therefore to be read as amended for the purpose of interpretation.

10.General Versus Specific Provisions. If an agreement contains both general and specific provisions relating to the same thing, special provision will prevail.

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