Main Requirements of an Agreement or Contract Under Pakistani Law

In Pakistan, contracts are governed by the Contract Act, 1872, which outlines the essential elements required for a valid and legally enforceable agreement. Below are the key requirements for a valid contract under Pakistani law:

1. Offer and Acceptance

• Offer (Proposal): One party must make a clear and definite proposal.
• Acceptance: The other party must unconditionally accept the offer in the same terms as proposed.
• Communication: Both offer and acceptance must be communicated between the parties.

2. Intention to Create Legal Relations

• The agreement must be intended to create legal obligations. Social or domestic agreements (e.g., family promises) are usually not legally binding unless proven otherwise.

3. Lawful Consideration

• Consideration refers to something of value (money, goods, services, or a promise) exchanged between the parties.
• The consideration must be lawful—it cannot involve illegal activities (e.g., bribes, fraud).

4. Competent Parties

• The parties entering the contract must be:
  • Of legal age (18 years or older).
  • Of sound mind (mentally capable of understanding the contract).
  • Not disqualified by law (e.g., insolvent persons in certain cases).

5. Free Consent

• Consent must be given freely, without:
  • Coercion (threat or force).
  • Undue influence (unfair pressure).
  • Fraud (false representation).
  • Misrepresentation (false statement).
  • Mistake (a genuine misunderstanding of facts).

6. Lawful Object

• The purpose of the contract must be legal. Agreements for illegal acts (e.g., smuggling, gambling where prohibited) are void.

7. Certainty and Possibility of Performance

• The terms of the contract must be clear and definite.
• The agreement must be capable of being performed—impossible obligations (e.g., selling a destroyed property) make the contract void.

8. Compliance with Legal Formalities (If Required)

• Some contracts must be in writing, registered, or witnessed (e.g., sale of immovable property under the Registration Act, 1908).

Void and Voidable Contracts

• Void Contract: Invalid from the beginning (e.g., illegal agreements).
• Voidable Contract: Valid until one party chooses to cancel it due to coercion, fraud, etc.

Conclusion

For a contract to be legally enforceable in Pakistan, it must fulfill all the essential elements under the Contract Act, 1872. If any requirement is missing, the agreement may be deemed invalid or unenforceable in court.