Carlill Vs Carbolic smoke Ball co

“a wagering contract is one by which two persons, professions to hold opposite views touching the issue of a future uncertain event, mutually agree that , dependent upon the determination of that event, one shall win from the other and that other shall pay or hand over to him, a sum of money or other stake; neither of the parties having any other interest in the contract than the sum or stake he will so win or lose, there being no other consideration for making of such contract by either of the parties. If either of the parties may win but can’t lose, or may lose but can’t win, it is not a wagering contract

Tata Cellular Vs Union of India [(1994) 6 SCC 651]

In this regard, theHon'ble Supreme Court laid down the areas of scope of judicial review in tender process

"69. A tender is an offer. It is something which invites and is communicated to notify acceptance. Broadly stated, the following are the requisites of a valid tender :

1. It must be unconditional.

2. Must be made at the proper place.

3. Must conform to the terms of obligation.

4. Must be made at the proper time.

5. Must be made in the proper form.

6. The person by whom the tender is made must be able and willing to perform his obligations.

7. There must be reasonable opportunity for inspection.

8. Tender must be made to the proper person.

9. It must be of full amount." 

Aravinthan case, III (2002) ACC 738

If property in the goods passes to the consignee, only consignee can sue the carrier.

Taylor Vs Portington

An agreement to take a lease of a house if put into thorough repair, and the drawing-rooms handsomely decorated according to the present style. Held, too uncertain for the Court to enforce.

Hadley & Anor v Baxendale & Ors,1854 EWHC Exch J70

One broken shaft, to be conveyed by the defendants as carriers and although such second day elapsed before the commencement of this suit, yet the defendants did not nor would deliver the said broken shaft at Greenwich on the said second day, but wholly neglected and refused so to do for the space of seven days after the said shaft was so delivered to defendant. Due to absence of that shaft, mill of plaintiff was closed. The plaintiffs' servant told the clerk of defendant that the mill was stopped, and that the shaft must be sent immediately; and in answer to the inquiry when the shaft would be taken, the answer was, that if it was sent up by twelve o'clock an day, it would be delivered at Greenwich on the following day.
if the special circumstances under which the contract was actually made where communicated by the plaintiffs to the defendants, and thus known to both parties, the damages resulting from the breach of such a contract, which they would reasonably contemplate, would be the amount of injury which would ordinarily follow from a breach of contract under these special circumstances so known and communicated. But, on the other hand, if these special circumstances were wholly unknown to the party breaking the contract, he, at the most, could only be supposed to have had in his contemplation the amount of injury which would arise generally, and in the great multitude of cases not affected by any special circumstances, from such a breach of contract.
The rule that the immediate cause is to be regarded in considering the loss, is applicable here. There was no special contract between these parties. A carrier has a certain duty cast upon him by law, and that duty is not to be enlarged to an indefinite extent in the absence of a special contract, or of fraud or malice. The maxim "dolus circuitu non purgatur", does not apply. The duty of the clerk, who was in attendance at the defendants' office, was to enter the article, and to take the amount of the carriage; but a mere notice to him, such as was here given, could not make the defendants, as carriers, liable as upon a special contract.

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Satyabrata Ghose v. Mugneeram Bangur and Co., and another AIR 1954 SC 44 The apex Court held that the obligations of the parties to a contract for sale of land are the same as in other ordinary contracts and consequently there is no conceivable reason why the doctrine of frustration should not be applicable to contracts for sale of land in India.

Chitty on Contracts, 28th edition at page 838, it is stated : "Objects which on grounds of public policy invalidate contracts may, for convenience, be generally classified into five groups : first objects which are illegal by common law or by legislation: secondly, objects injurious to good government either in the field of domestic or foreign affairs: thirdly, objects which interfere with the proper working of the machinery of justice; fourthly, objects, injurious to marriage and morality; and fifthly, objects economically against the public interest. This classification is adopted primarily for case of exposition. Certain cases do not fit clearly into any of these five categories."

Contract-Sec23, 30 Gherulal Parakh v. Mahadeodas Maiya, AIR 1959 (SC) 781 The law on the subject is well settled and does not call for any citation of cases. To constitute a wagering contract there must be proof that the contract was entered into upon terms that the performance of the contract should not be demanded, but only the difference in prices should be paid. There should be common intention between the parties to the wager that they should not demand delivery of the goods but should take only the difference in prices on the happening of an event. The question, shortly stated, is whether what is void can be equated with what is forbidden by law. This argument is not a new one, but has been raised in England as well as in India and has uniformly been rejected. The doctrine of public policy may be summarized thus : Public policy or the policy of the law is an illusive concept; it has been described as "untrustworthy guide", "variable quality", "uncertain one" "unruly horse", etc; the primary duty of a Court of Law is to enforce a promise which the parties have made and to uphold the sanctity of contracts which form the basis of society, but in certain cases, the Court may relieve them of their duty on a rule founded on what is called the public policy; for want of better words Lord Atkin describes that something done contrary to public policy is a harmful thing, but the doctrine is extended not only to harmful cases but also to harmful tendencies. The common law of England and that of India have never struck down contracts of wager on the ground of public policy; indeed they have always been held to be not illegal notwithstanding the fact that the statute declared them void. Even if it is permissible for Courts to evolve a new head of public policy under extraordinary circumstances giving rise to incontestable harm to the society, we cannot say that wager is one of such instances of exceptional gravity, for it has been recognized for centuries and has been tolerated by the public and the State alike. If it is has any such tendency, it is for the legislature to make a law prohibiting such contracts and declaring them illegal and not for this Court to resort to judicial legislation. The word "immoral" is a very comprehensive word. Ordinarily it takes in every aspect of personal conduct deviating from the standard norms of life. It may also be said that what is repugnant to good conscience is immoral. Its varying content depends upon time, place and the stage of civilization of a particular society. In short, no universal standard can be laid down and any law based on such fluid concept defeats its own purpose. The provisions of Section 23 of the Contract Act indicate the legislative intention to give it a restricted meaning.

Anson in his Law of Contracts states at p. 222 thus : "The only aspect of immorality with which Courts of Law have dealt is sexual immorality ............." Halsbury in his Laws of England, 3rd Edn., Vol. 8, makes a similar statement, at p. 138 : "A contract which is made upon an immoral consideration or for an immoral purpose is unenforceable, and there is no distinction in this respect between immoral and illegal contracts. The immorality here alluded to is sexual immorality."

Egerton v. Brownlow, (1853) 4 HLC 121 : 10 ER 359, 408, Parke B. " `Public policy' is a vague and unsatisfactory term, and calculated to lead to uncertainty and error, when applied to the decision of legal rights; it is capable of being understood in different senses; it may, and does, in its ordinary sense, mean `political expedience' or that which is best for the common good of the community

Cheshire and Pifoot in their book on "Law of Contract" 3rd Edn., observe at page 280 thus : "The public interests which it is designed to protect are so comprehensive and haterogeneous, and opinions as to what is injurious must of necessity vary so greatly with the social and moral convictions, and at times even with the political views, of different judges, that it forms a treacherous and unstable ground for legal decision. These questions have agitated the Courts in the past, but the present state of the law would appear to be reasonably clear. Two observations may be made with some degree of assurance. First, although the rules already established by precedent must be moulded to fit the new conditions of a changing world, it is no longer legitimate for the Courts to invent a new head of public policy. A judge is not free to speculate upon what, in his opinion, is for the good of the community. He must be content to apply, either directly or by way of analogy, the principles laid down in previous decisions. He must expound, not expand, this particular branch of the law. Secondly, even though the contract it one which prima facie falls under one of the recognized heads of public policy, it will not be held illegal unless its harmful qualities are indisputable. The doctrine, as Lord Atkin remarked in a leading case, "should only be invoked in clear cases in which the harm to the public is substantially incontestable, and does not depend upon the idiosyncratic inferences of a few judicial minds. In popular language the contract should be given the benefit of the doubt."

Shibho Mal v. Lachman Das, ILR 23 All 165, an agent who paid the losses on the wagering transactions was allowed to recover the amounts he paid from his principal. In Beni Madho Das v. Kaunsal Kisshor ILR 22 All 452, the plaintiff who lent money to the defendant to enable him to pay off a gambling debt was given a decree to recover the same from the defendant. Where two partners entered into a contract of wager with a third party and one partner had satisfied his own and his co-partner's liability under the contract, the Nagpur High Court, in Md, Gulam Mustafakhan v. Padamsi AIR 1923 Nag 48, held that the partner who paid the amount could legally claim the other partner's share of the loss.

Hyams v. Stuart King, 1908-2 KB 696 deals with the problem of the legality of a fresh agreement between parties to a wager for consideration. There, two bookmakers had betting transactions, together, which resulted in the defendant giving the plaintiff a cheque for the amount of bets lost to him. At the request of the defendant, the cheque was held over by the plaintiff for a time, and part of the amount of the cheque was paid by the deft. Subsequently a fresh verbal agreement was come to between the parties, by which, in consideration of the plaintiff holding over the cheque for a further time and refraining from declaring the defendant a defaulter and thereby injuring him with his customers the defendant promised to pay the balance owing in a few days. The balance was never paid and the plaintiff filed a suit to recover the money on the basis of the fresh verbal agreement. The Court of Appeal, by a majority, Fletcher Moulton L.J. dissenting, held that the fresh verbal agreement was supported by good consideration and therefore the plaintiff was entitled to recover the amount due to him.

betting

Partridge v. Mallandaine, (1886) 18 QBD 276, is to the effect that persons receiving profits from betting systematically carried on by them are chargeable with income tax on such profits in respect of a "vocation" under 5 and 6 Vict. c. 35 (the Income Tax Act) Schedule D. Hawkins J. rejecting the argument that the profession of bookmakers is not a calling within the meaning of the Income Tax Act, makes the following observations, at page 278 : "Mere betting is not illegal. It is perfectly lawful for a man to bet if he likes. He may, however, have a difficulty in getting the amount of the bets from dishonest persons who make bets and will not pay."

contract

Thacker v. Hardy (1878) 4 QB 683, the plaintiff, a broker, who was employed by the defendant to speculate for him upon the stock exchange, entered into contracts on behalf of the defendant with a third party upon which he (the plaintiff) became personally liable. He sued the defendant for indemnity against the liability incurred by him and for commission as broker. The Court held that the plaintiff was entitled to recover

IPC-Sec 294A

M/s. B.R. Enterprises v. State of U.P.,AIR 1999 (SC) 1867 a gambling may be taxed and may be authorised for a specified purpose, but it would not attain the status of trade like other trades or become res commercium. No gambling could be commercium hence in our considered opinion the principle of RMDC case (supra) would equally be applicable even to the State organised lottery. whenever a State decides to run or not to run its lotteries it is the State which has to decide as a public policy in the public interest. Once such a decision is taken to have in its State lottery free zone, the entrustment of power by the Parliament cannot be said to be ultra vires.