CORPORATE LEGAL FRAMEWORK

BALFOUR VS BALFOUR [1919]

Facts:
Mr.Balfour and Mrs.Balfour are a young couple married in 1913.Mr.Balfour was a civil
engineer and worked as director of irrigation in Ceylon,Srilanka.From November 1915 to
August 1916 Mr.Balfour had vacation.so the couple decided to go to England to enjoy their
vacation.During this vacation,Mrs.Balfour got sick and suffered from arthritis.Doctor adviced
her to stay in England still she recover and adviced not to travel to Ceylon as she may be
affected badly due to the climate changes.Mr.Balfour need to go to Ceylon back to continue
his work as his vacation got over.Mr.Balfour promised Mrs.Balfour orally that he will send
30 Euros every month until Mrs.Balfour recovered and come back to Srilanka.Initially
Mr.Balfour kept up with his promises and sent the amount as per the promise and after a
period of months Mr.Balfour stopped sending the amount to Mrs.Balfour.As per this case
Mr.Balfour is the defendant and Mrs.Balfour is the plaintiff.

Issue:
Wheather Mrs.Balfour can file a case against Mr. Balfour?

Content:
According to this case, Mr Balfour and his wife went to England for a vacation, and his wife
became ill and needed medical attention. They settled on an arrangement that Mrs Balfour
was to stay behind in England when Mr.Balfour got back to Ceylon (Sri Lanka) and that Mr.
Balfour would pay his wife 30 Euros per month until he returned.Mr.Balfour failed to pay the
promised amount and Mrs.Balfour has sued for the recovery of amount. The promise made
by Mr.Balfour of providing monthly expenses to his wife comes under social or
domestic , personal and religious agreements. Anything that comes under this
category did not intend to be legally bound.

Judgement:
Agreements made between a husband and wife to provide capitals are generally
not contracts because this comes under social or domestic , personal and
religious agreements.Finally the suit was dismissed.So the balfour law made it
very clear that the legal intention to go into an agreement is extremely
fundamental. At common law, a contract is not enforceable unless the parties
intended the contract to create legal relations.Agreement made between parties
must create legal relationship and it consists of rights and obligations which can
be claimed in the court of law.The parties cannot enforce and the judges who had
made the decision concluded that the court cannot come into marital affairs and
it is up to their full knowledge for solving their own problems. So the Balfour
law gave a new perspective to contract validation.

CARLILL VS CARBOLIC SMOKE BALL COMPANY [1892]

Facts:
The case was happened in the court of appeal under civil division.Carlill is a
plaintiff and carbolic is defendant. The plaintiff i.e,Carlill believing the advertisement in
a newspaper stating the use of the smoke ball would prevent the influenza and flu. She used
the smoke ball as prescribed in the advertisement for some time and still had an attack of
influenza. She filed the suit for 100 pounds as mentioned in the advertisement.

Issue:
whether the promise mentioned in the advertisement of a reward of 100 pounds was meant to
be an expressed promise or just a sales puff to lead people into buying their product.

Content:
There was a pandemeic during 1889-90. Carbolic Smoke Ball Company placed an
advertisement in several newspapers on November 13, 1891 of their product
which if used 3 times daily for 2 weeks would prevent the flu and influenza. And
also the company i.e, Carbolic additionally offered a 100 pounds reward to
anyone who would might get flu or influenza after using their product as
prescribed with a prescription supplied with the ball by stating that they had deposited 1000
pound just for the reward and thus makes the people to buy their product. The plaintiff i.e,
Louis Carlill after seeing the above-mentioned advertisement in one of the newspapers
bought the smoke ball and started using it from November 20, 1891 until January 17, 1892
exactly as prescribed in printed prescription supplied with the ball. But she had an influenza
attack later.

Judgement:
The contract between the company(Carbolic) and the plaintiff(Carlill) was a valid
contract.The company is asked to pay whatever they claimed at the time of
offering.This will come under the Unilateral contract which is nothing but one
sided contract.It is a type of contract where only one party has to perform his
promise.Here the company’s claim of depositing 1000 pound at Alliance Bank showed
seriousness to keep the promise.  

MOHORI VS DHARMODAS GHOSE

Issue:
Wheather the deed was void under section 2 , 10[5] , 11[6] , of Indian Contract
Act,1872 or not?

Wheather the defendant was liable to return the amount of loan which he had
received by him under such deed or mortgage or not?

Wheather the mortgage commenced by the defendant was voidable or not?

Content:

Dharmodas Ghose was the respondent for this case. He was a minor (for example
has not finished the 18 years old) and he was the sole proprietor of his enduring
property. The mother of Dharmodas Ghose was approved as his legal custodian
by Calcutta High court. When he went for the mortgage of his own immovable
property which was done in the favor of Brahmo Dutta, he was a minor and
secured this mortgage deed for Rs. 20,000 at 12% interest rate as per year.
Brahmo Dutta who was a money lender at that time and he secured a loan or
amount of Rs. 20,000, and the management of his business was in the control of
Kedar Nath and Kedar Nath acted as the attorney of Brahmo Dutta. Dharmodas
Ghose’s mother sent a notification to Brahmo Dutta informing him about the
minority of Dharmodas Ghose on the date on which such mortgage deed was
commenced, but the proportion or the sum of loan that was actually provided was
less then Rs. 20,000. The representative of the defendant, who actually acted
instead of on behalf of money lender has given money to the plaintiff, who was a
minor and he fully had knowledge about the incompetency of the plaintiff to
perform or enter into contract and also that he was incompetent legally to
mortgage his property which belonged to him.On 10th September 1895
Dharmodas Ghose along with his mother filed a case against Brahmo Dutta by
saying that the mortgage that was executed by Dharmodas was commenced when
he was a minor or infant and so such mortgage was void and or improper and as
a result of which such contract should be revoked.

Judgement:
Since minor was incompetent to make such mortgage hence the contact such made or
commenced shall also being void and not valid in the eyes of law.The minor i.e. Dharmodas
Gosh cannot be forced to give back the amount of money that was advanced to him, because
he was not bound by the promise that was executed in a contract.
LOWE V. PEERS

Facts:
The case of lowe v.peers set a precedent in the law relating to restraint of marriage. In this
case, the defendant contended that if he marries any other person except the plaintiff, he
would give her 1000 pounds within three months of his marriage. 

Issue:
Wheather the agreements in restraints of marriage is valid or void?

Content:
The defendant assured the plaintiff that if he marry anyother person except her then he would
give 1000 pound to her from the date not exceeding 3 months from his marriage(with any
other lady other than the plaintiff).

Judgement:
It was held that such an agreement is void. According to Section 26 of the Indian Contract
Act, all agreements in restraint of marriage except that of a minor are void.(Another
Exmple:If A asks B not to marry C and B agree with A not to marry C.But after a few month
B got married with C then also B is not bound to pay or answer A hence the contract is
void.Any contracts that stops or foceanyone not to marry then its not enforceable by law.

DEVJI SHIVJI VS KARSANDAS RAMJI

Facts:
This is an appeal by the plaintiff in a suit in which a declaration was sought that a registered
deed of assignment dated 7-8-1948, executed by the plaintiff in favour of the defendant No. 1
with regard to the assets and the goodwill of the business, which was carried on in the name
and, style of Devji Shivji & Sons, was a mere benami document. The plaintiff had further
prayed that a decree be passed in his favour against the defendants declaring that the sum of
Rs. 52,308/10/6 standing to the credit of Devji Shivji & Sons in the Lloyds Bank Limited,
Calcutta, belongs to him. The defendant No. 1 is the son-in-law of the plaintiff, and the
defendant No. 2 is the Lloyds Bank with whom the money is in deposit. The case put forward
by the plaintiff was that under the advice of the defendant No. 1, who since May, 1947, had
been looking after his affairs and managing his business known as Devji Shivji & Sons, he
executed the deed of assignment and also a power of attorney dated 21-8-1947 constituting
the defendant No. 1, one Mohanlal Odhabji Thacker and his wife Kamla, Bai as his attorney
and authorising them to manage the affairs and the property including the business known as
Devji Shivji & Sons. According, to the plaintiff's allegation, shortly before the institution of
this suit he had come to know that the defendant No. 1 had opened an account in the name of
Devji Shivji & Sons in the Bank of India Limited, Calcutta, and had deposited, with the bank
some cheques which had been received from customers as the price of the coal business of
the plaintiff which was carried on under the name and style of Devji Shivji & Sons and that
after closing the said account he had opened another account with the Lloyds Bank Limited
in the name of Devji Shivji & Sons and had deposited with them cheques received from the
customers as the price of coal and had been operating the same account.

Issue:
Wheather the issued document is a valid one?

Content:
According to Section 25, Contract Act, an agreement made without consideration is void
unless it is expressed in writing and registered under the law for the time being in force for
the registration of documents and is made on account of natural love and affection between
parties standing in a near relation to each other, there being two other clauses in the section
which are not relevant to our present consideration. Explanation 1 of the section says that
nothing in the section shall affect the validity; as between the donor and donee, of any gift
actually made. 

Conclusion:
The learned Subordinate Judge came to the conclusion that the deed of assignment was a
genuine and a valid document, and he accordingly dismissed the claim of the plaintiff.