Consideration is of major essence in a contract

KARTHIK.T | SASTRA DEEMED TO BE UNIVERSITY THANJAVUR | 14th July 2020

Durga Prasad vs Baldeo

Facts:

The plaintiff requested the district collector to construct some shops in his town. Those shops were given for rent to the defendant for doing business. The rent was also fixed. Later, the defendant had  promised to the plaintiff that he will be giving  a 5% commission to him on all articles which he is going to sell through that shop in consideration of the construction of the building by the plaintiff by spending huge money. However, the defendant failed to pay the commission. So Durga Prasad filed a suit against the shopkeepers who did not give the commission.

Issues:

1. Whether the contract is valid or not?
2. Whether this is a proper contract or not?

Plaintiff contention

The plaintiff contended that The defendant promised to give a 5% commission for all the articles sold through the shop, and the articles have been sold. as the defendant’s consideration of the construction of the building is there  so it makes It a proper contract. So the defendant is supposed to give the 5% commission.

Defendant contention

The construction of the building was done without the consideration of the defendant. The defendant never showed any intention to construct the building. So the contract is invalid.

Observation:

The parties have no proper consideration, so it is not a proper contract between the parties. The Indian Contracts Act clearly stated that the contract without consideration is void. The consideration of both of the parties was necessary. In this case, there was no personal benefit for the promissory, the plaintiff on the ground that the construction of the shop was not done at the desire of the defendant but was done at the desire of the district collector.

Judgment:

The court held that the claims for the plaintiff were rejected because there is no proper contract between the plaintiff and the defendant mainly the contract has no proper consideration. Contract without consideration is void. The promissory has no personal benefit about the contract. The contract was done without the intention of the promissory. So the contract is void.