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PRINCIPLES RELATING TO FORCE MAJEURE- CURRENT CRISIS OF COVID19

April 10, 2020

Laws involved: Contract Act,1872 and Transfer of Property Act,1882 Contract Act, 1872 S.32 ENFORCEMENT OF CONTRACTS CONTINGENT ON AN EVENT HAPPENING.—Contingent contracts to do or not to do anything if an uncertain future event happens, cannot be enforced by law unless and until that event has happened. If the event becomes impossible, such contracts become void. Section: 56 Agreement to do impossible act.—An agreement to do an act impossible in itself is void. Contract to do an act afterwards becoming impossible or unlawful.—A contract to do an act which, after the contract is made, becomes impossible, or, by reason of some event which the promisor could not prevent, unlawful, becomes void when the act becomes impossible or unlawful. Compensation for loss through non-performance of act known to be impossible or unlawful.—Where one person has promised to do something which he knew, or, with reasonable diligence, might have known, and which the promisee did not know, to be impossible or unlawful, such promisor must make compensation to such promisee for any loss which such promisee sustains through the non-performance of the promise. Section: 62 EFFECT OF NOVATION, RESCISSION, AND ALTERATION OF CONTRACT.—If the parties to a contract agree to substitute a new contract for it, or to rescind or alter it, the original contract need not be performed. Section:64 CONSEQUENCES OF RESCISSION OF A VOIDABLE CONTRACT.—When a person at whose option a contract is voidable rescinds it, the other party thereto need not perform any promise therein contained in which he is the promisor. The party rescinding a voidable contract shall, if he had received any benefit thereunder from another party to such contract, restore such benefit, so far as may be, to the person from whom it was received. Sale of Goods Act ,1930 S.57 DAMAGES FOR NON-DELIVERY.—Where the seller wrongfully neglects or refuses to deliver the goods to the buyer, the buyer may sue the seller for damages for non-delivery. 58. SPECIFIC PERFORMANCE.—Subject to the provisions of Chapter II of the Specific Relief Act, 1877 (1 of 1877), in any suit for breach of contract to deliver specific or ascertained goods, the Court may, if it thinks fit, on the application of the plaintiff, by its decree direct that the contract shall be performed specifically, without giving the defendant the option of retaining the goods on payment of damages. The decree may be unconditional, or upon such terms and conditions as to damages, payment of the price, or otherwise, as the Court may deem just, and the application of the plaintiff may be made at any time before the decree. 59. REMEDY FOR BREACH OF WARRANTY.— (1) Where there is a breach of warranty by the seller, or where the buyer elects or is compelled to treat any breach of a condition on the part of the seller as a breach of warranty, the buyer is not by reason only of such breach of warranty entitled to reject the goods; but he may— (a) set up against the seller the breach of warranty in diminution or extinction of the price; or (b) sue the seller for damages for breach […]

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