Classification of contract under English Law

Classification of contract under English Law. English Law classified into:

(1) Formal Contract.

(2) Simple Contract.

1.    Formal Contract. These contracts are in vogue in England. The Indian Contract Act does recognize these Contracts. Consideration is not essential in such Contracts.

These Include

(a)  Contract of record, and

(b) Contracts under seal.

(a) Contracts of record. These are judgments and recognizances. Such contract exists by reason of the entry in the records of the court in which the proceedings are brought.

A judgment gives right and obligations of litigants as between themselves. A recognizance is a written acknowledgement of a debt due to the crown. The phrase, “contract of records” is misleading as it suggests that the obligation spring from agreement, whereas really it is imposed upon the parties by an outside authority.

(b)  Contract under seal. These are contract created by a sealed document which is called a ‘deed’. Such contract may be executed with certain formalities.  These must be a document, in print or in writing, and must be signed, sealed and delivered.

The following contract must be under seal:

(1)  Contracts made without consideration.

(2)  Contracts made by corporation or companies.

(3)  Contracts of lease relating to land for more than three years.

(4)  Contracts relating to transfer of British ship or any share therein.

2.    Simple Contracts. Contracts which are not formal are known as simple contract. These are also called ‘parol’ contracts. They may be in writing, or made orally, or they may be implied from the conduct of the parties. All simple contract must be supported by consideration.