TYPES

OF
CONTRACTS
Dr/ Mena Shaker
 Welcome to our lectures
 Contracts are different types and varies from
situation to another .

 We will try to discover the well known types

of them
 Contract classification
 In connection with contracts, there are four types
of classifications.
 Types of contracts in contract law are as follows;

 1. On the basis of Formation,

 2. On the basis of Nature of Consideration,
 3. On the basis of Execution .
 4. On the basis of Validity.
 Types of Contracts
on the basis of Formation

 On this base Contracts can be classified into three groups, namely

Express, Implied, Quasi Contracts.

 Express Contracts: The Contracts where there is expression or

conversation are called Express Contracts. For example: A has offered to
sell his house and B has given acceptance. It is Express Contract.

 Implied Contract: The Contracts where there is no expression are called

implied contracts. Sitting in a Bus can be taken as example to implied
contract between passenger and owner of the bus.

 Quasi Contract: In case of Quasi Contract there will be :

no offer and acceptance so, Actually there will be no Contractual
relations between the partners.
 The obligation of another party imposed by law independently of an

agreement between the parties

 The Court room ( judge )
A B
Plaintiff (‫) ااالمدعى‬ Defendant ( ‫)ااالمدعىعليه‬
Presented a service or product Beneficiary
( A ) Provided service to the other party( B ) without
( offer – acceptance - agreement – conditions)
which (B) benefited from it
Need his right ( money ) Don’t want to pay
The arbitration :
The judge will require a (semi-contract) called ( Quasi contract )
and forces the benefited party to return the property which received
even in the absence of a written contract.

Ex:
1. Pizza by mistake of delivery
2. Engagement Gifts
3. Pay for someone in need
 Accprding to Contract Act about the situations
where court can create Quasi Contract.

 • When necessaries are supplied

 • When expenses of one person are paid
by another person.
 • When one party is benefited by the
activity of another party.
 • In case of finder of lost tools.
 •When payment is made by mistake or
goods are delivered by mistake.
 Example:
 A case on this occasion is A Vs B.
 In this case A`s husband becomes no more. She is
very poor and therefore not capable of paying for
funeral
 B, one of her relatives, understand her position
and spends his own money for funeral .
 It is done so without A`s request.
 Afterwards B claims his amount from A
 where A refuses to pay.
 Here , The court creates a Quasi Contract
between them.
 Types of Contracts on the basis of Nature of
Consideration

 On this base, Contracts are of two types. Namely

Bilateral Contracts and Unilateral Contracts.

 Bilateral Contracts: If considerations in both directions

are to be moved after the contract, it is called Bilateral
Contract.

Example:
 A Contract has got formed between X and Y on 1st Jan,
According to which X has to deliver goods to Y on 3rd
Jan and Y has to pay amount on 3rd Jan.
 It is bilateral contract.
on the basis of Nature of Consideration .
Cont.
 Unilateral Contract: If considerations is to be
moved in one direction only after the Contract,
it is called Unilateral Contract.

Example:
 A has lost his purse and B is its finder.

There after B searches for A and hands it over to A.

Then A offers to pay 100 $ to B .
to which B gives his acceptance.
Here, after the Contract consideration moves from
A to B only. It is Unilateral Contract.
 Types of Contracts on the basis of Execution

 On this base Contracts can be classified into

two groups.
namely, Executed and Executory Contracts.
 If performance is completed, it is called
executed contract.
 In case where contractual obligations are to be
performed in future, it is called
executory contract.
Types of Contracts On the basis of legal Validity

On this base Contracts can be classified

into ( 5 groups ) . Namely such as :

 Valid,
 Void,
 Voidable,
 Illegal,
 Unenforceable
 Legal validity

 1. Valid and enforceable - All elements of legal

and binding contract present.
 2. Void - Contract without legal force or effect.
 3. Voidable - Contact that can be an-nulled by
either party after signing because it is legally
defective or allows one party to rescind the
contract.
 4. illegal contract : Contract does not compatible
with law therfore it is not legal .
 5- Unenforceable - A contract that cannot be
verified for legal enforcement or fails to meet
certain requirements.
 Valid:
  The Contracts which are enforceable in a court of law are
called Valid Contracts.

To attain Validity the Contract should have certain features

like:
 Consensus ,

 Certainty,

 free consent,

 two directional consideration,

 fulfillment of legal formalities,

 legal obligations,

 lawful object,

 capacity of parties,

 possibility of performance, …..etc.

 Example:
  There is a Contract between X
and Y and let us assume that
their contract has all those
above said features.

 It is Valid Contract.
 Void:
 A Contract which is not enforceable in a court
of law is called Void Contract.

 If a Contract is deficient in any one or more of

the above features
 (Except free consent and legal formalities).
 It is called Void Contract.
 Example:
 there is a Contract between X
and Y
 where Y is a “ minor “ :

who has no capacity to contract.

 It is Void Contract.
 Voidable:
 A Contract which is deficient in only
free consent, is called Voidable Contract.
 That means it is a Contract which is

made under certain pressure either

physical or mental.
 At the option of suffering party,

a voidable contract may become either

Valid or Void in future.
 Example:
 There is a Contract between A and B
where B has forcibly made A involved
in the Contract.

 It is voidable at the option of A.

 Illegal:
 If the contract has unlawful object it is
called Illegal Contract.

 Example:
There is a contract between X and Y
according to which Y has to murder Z for a
consideration of 10 000 $ from X.
It is illegal contract.
 Unenforceable:
 A contract which has not properly
fulfilled legal formalities is called
unenforceable contract.

 That means unenforceable contract

suffers from some technical defect like
insufficient stamp etc.
 After rectification of that technical defect,
it becomes enforceable or valid contract.
 Example:

 A and B have drafted their agreement

on 1 $ stamp where it is to be written
actually on 10 $ stamp.

 It is unenforceable contract.
 Void Contracts and Illegal Contracts

 All illegal Contracts are void,

 but all void contracts are not legal:

 An illegal Contract will not be implemented

by court. So, illegal contract is Void.
 A void contract may not be illegal because its
object may be lawful.
 Cont.
 The Contracts which are collateral to
illegal contract are void,
 But the contracts which are collateral to
Void contract may be Valid:
 An illegal makes not only itself Void but
also the contracts connected to it.
 But a contract collateral to void contract
may attain Validity because object of
main contract is lawful.
 Void Contracts and Voidable Contracts

 Becoming Valid: A Voidable Contract may

become Valid at the option of suffering party.
 But a Void Contract can never and never become
Valid.
 Third Party Rights: In case of Voidable Contracts
third party may attain rights on concerned
property,
 If the third party gets the property before the
Voidable Contracts gets declared as Void.
 But in case of Void Contract third party cannot
get any right
 Comparison
Sr. Types Meaning Definition
base
Parties state the terms of the agreement to which they
 1 Express ‫تعبيريا‬
will be found, usually in writing

Terms of agreement can be reasonably inferred by acts

 2 Formation Implied ‫ضمنيا‬
of the parties‫ و‬not expressed in writing or orally

no offer and acceptance so, no Contractual relations

 3 Quasi ‫ظاهريا‬
between the partners
 4 Bi-lateral ‫ ثنائيا‬All parties exchange promises to perform.
Consideration
 5 Uni-lateral ‫ احاديا‬One party makes a promise in anticipation of some act

 6 Executed ‫ تنفيذا كليا‬All parties have completed their promises.

Execution Contract only partially performed or totally
 7 Executory ‫تنفيذا جزئيا‬
unperformed by the parties.

 8 Valid ‫ قابل للتنفيذ‬All elements of legal and binding contract present.

‫غير قابل للتنفيذ‬

 9 Void ( ‫ ) باطل‬Contract without legal force or effect.
Contact can be an-nulled by either party because it is
 10 Validity Voidable ‫ قابل لللغاء‬legally defective or allows one party to rescind the
contract.
 11 Il-legal ‫ غير قانونيا‬Contract has unlawful object .

A contract that cannot be verified for legal

 12 Un- enforced ‫غير واجب النفاذ‬
enforcement or fails to meet certain requirements.

Note that : The type of contract changed according to different cases in exchange the promises
Enjoy your contracting now
 Quiz ..

Q1 : Draw a smart table explaining the next :

 1- the classification of business law contract

 2- give a short definition for every type .
 3- Express the difference between them .

With many thanks