SPECIAL CONTRACTS

                                                    



CONTRACT OF INDEMNITY-

A contract of indemnity is considered as contingent contract.

It is  a contractual agreement between two parties whereby one party agrees to pay for potential losses or damages caused by another party. A typical example is an insurance contract, in which the insurer or the indemnitor agrees to compensate the other (the insured or the indemnitee) for any damages or losses in return for premiums paid by the insured to the insurer. With indemnity, the insurer indemnifies the policyholder—that is, promises to make whole the individual or business for any covered loss.

Indemnity is somewhat similar to compensation. Its main purpose is to compensate the loss incurred and not make profits out of mishaps.

In contract of indemnity there are two parties. Indemnifier and indemnity holder.

In contract of indemnity there is only one agreement


CONTRACT OF GUARANTEE-

A contract of guarantee is a contract to perform the promise or discharge the liability of third person in case of default.

In contract of guarantee, the primary liability is of principal debtor and the liability of surety is secondary.

Contract between surety and principal debtor is implied and between creditor and principal debtor is express.

In contract of guarantee there are three parties i.e. creditor, the principal debtor and surety.

In contract of guarantee there are three agreements i.e. agreement between the creditor and principal debtor, the creditor and surety and surety and principal debtor


CONTRACT OF AGENCY

A contract which creates legal relationship of principal and agent between two parties is called a contract of agency. Section 182 of Indian contract Act 1872 defines the terms of agent and principal.A principal can be minor but an agent can never be minor. The essence of agency contract is that an agent acquire a representative character and all his action as agent make the principal liable as it has been done by principal.

CONTRACT OF BAILMENT

Bailment means a delivery of goods from one person to another for a special purpose. According to Sec 148 of the Contract Act, 1872, 'A bailment is the delivery of goods by one person to another for some purpose, upon a contract that they shall, when the purpose is accomplished, be returned or otherwise disposed of according to the directions of the person delivering them.
The pledgee has a right to sale on default.



CONTRACT OF PLEDGE

 According to section 172 of Indian contract Act 1872, Pledge means delivery of goods as security for the payment of debt or performance of a promise. The Bailor is called the Pawnor and the bailee is called pawnee. There is no right to sale in case of default.

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