Q#11 Discuss in detail the position of a quasi-contract when the

obligations of contract are imposed by the law

Or
What are the types of quasi contract?

Quasi / constructive / implied Contract

Quasi contracts are based on the principle of equity (
).

) and Justice (

It means that nobody is entitled to benefit at the cost of other. Some time law requires
that a particular person must perform some obligations such obligations are called
quasi contract they are also called constructive or implied contract.

Kinds of contract
Or
Conditions under which quasi contract arise
1.
2.
3.
4.
5.

Supply of necessaries
Payment by interested person
Compensation for non gratuitous acts
Finder of goods
Mistake or under coercion

1) Supply of necessaries
Where necessaries are supplied to a person who is incompetent to contract or to
someone whom he is legally bound to support, the supplier is entitled to recover the
price from the property of incompetent person.
Example
Ali supplies Hammad a minor, necessaries suitable to their conditions in life. Ali is
Entitled to reimburse (
) form Hammads Property.

2) Payment by interested person

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A person who is interested in the payment of money which another is bound by law to
pay and who therefore pays it; it is entitled to be reimbursed by other.
Example
a) A pays arrears of rent of B to avoid dispute between B and his landlord (
)
A cannot recover from as he has no interest in payment
b) A imported Goods and stored in Bs warehouse without paying the custom
duty. The custom duty Authorities recovered custom duty from B. B can
recover from B
3) Compensation for Non- gratuitous act
When a person lawfully does anything for another person, or delivers anything to him,
not intending to give as a free gift, the other person also enjoys benefit thereof. Later
he is bound to compensate former (
).
Example
A coolie takes the luggage of passenger at the railway station without asking.
Passenger does not object (
) to it. Coolie can get the payment
4) Finder of goods
A person who finds the goods belonging to other and takes them into his custody, he
is entitled to recover compensation for the trouble in finding the owner of goods. If he
fails to find the true owner he can retain the ring
Example
Ali found a ring at a party he told the other guests about it but could not find the
owner. Ali can retain the ring.

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Q#12 what is the difference between indemnity and

guarantee?
Basis
Meaning

Indemnity
A contract of indemnity is to
comansate the loss suffered by a
person from the conduct of any
third person
In a contract of indemnity there
are three parties, indemnifier and
indemnity holder
The liability of indemnifier is
primary

Parties

Liability

Number of
contract

In contract of indemnity there is

only one contract between the
indemnifier and indemnity holder

Performance
of contract

In
contract
of
indemnity
performance depends upon the
possibility of loss
This contract is made for the
payment of loss
The indemnifier, promises without
the request of debtor

Nature
Request

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Guarantee
In contract of gurantee one person
gives
the gurantee
for the
performance of contract
In a contract of guarantee there are
there parties, surety, debtor, creditor
The liability of surety is secondary as
he is liable only when the creditor fails
to pay the debt
There are there contracts
Between surety and creditor
Between creditor and principal
Between surety and principal
In
contract
of
gurantee
the
performance depends upon if the
creditor fails to make the payment.
This contract is made for the payment
of debt
It is necessary that the surety must give
the gurantee at the request of debtor

Q#13 WHAT IS BAILEMENT? ALSO EXPLAIN THE

ESSENTIAL FEATURES OF BAILMENT.
Contract of bailment
Bailment
Bailment is a voluntary transfer of goods by the owner to another person for specific purpose
under a condition that such other person shall return the goods after the purpose is
accomplished.
Example
Ali delivered a piece of cloth to Bashir to make a suit, there is a contract of bailment between
Ali and Bashir.
Bailor
The person who delivers the goods to the other person is called Bailor.
Bailee
The person to whom goods are delivered under the contract of bailment is called Bailee
Essential features
i.
ii.
iii.
iv.

Contract
Specific purpose
No change of ownership
Return of same goods

1. Contract
There must be a contract of bailment between the parties. If the goods are delivered by
mistake, there is no bailment
2. Specific purpose
The goods must be delivered for some specific purpose. If the goods are delivered without
any purpose there is no contract of bailment.

3. No change of ownership
In contract of bailment only the possession of goods changed but the ownership remains in
the same hands. If the ownership of goods is changed it cannot be called bailment.
4. Return of same goods
When the purpose of bailment is accomplished, same goods must be returned to the bailer.
The deposit of money in a bank is not bailment because bank cannot return the same money,
however notes and other valuable goods deposited in bank are the examples of bailment.
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Q#14 what are the rights and duties of Bailor?

Rights and duties of Bailor are given below

Rights of Bailor
Following are the rights of Bailor

1. Right to recover damages

Bailor can claim for the damages that arise due to bailees negligence. He can also claim
damages arising due to unauthorized use of goods.
Example
Ali bailed some goods to Zeeshan but due to the negligence of Zeeshan the goods were
stolen. Ali can recover the damages.
2. Right to demand return of goods
The Bailor has right to get back the goods bailed after as soon as the purpose is
accomplished. If Bailee fails to return the Bailor can claim for the compensation
Example
Sajjid give a car to majjid on hire for 5 days. Majjid fails to return on 5thd day. Sajjid can
claim damages
3. Right to claim increase
The Bailor can claim any increase or profit, which may accrued from the bailed goods.
Example
Asad bailed a cow to khurram. Cow gave birth to a calf. Asad can claim cow along with calf.
4. Right to terminate bailment
The Bailor has a right to terminate the bailment if Bailee does any act which is against the
terms and conditions of bailment.
Example
Ali gives his car on hire to Junaid for personal use but Junaid start driving it as carriage. Ali
can terminate contract.
5. Right to sue
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Bailor can sue Bailee if he fails to return goods or breaches contract.

Example
Ali gives his mobile to Zain for repairing. Zain sold it to Tania. Ali can sue zain.
6. Compensation
If the Bailee without the permission of Bailor mixes the goods of Bailor with his own goods
in such a way that it becomes impossible to separate them, the Bailor has a right to claim for
the compensation for the loss of goods.
Example
Moshsin bailed 2 bags of Basmati Rice to Hassan. Hassan mixed them with his own rice that
was of cheap quality. Moshsin can claim for the compensation
Duties of Bailor
Following are the duties of Bailor
i)
ii)
iii)
iv)
v)

Duty to disclose faults

Duty to repay necessary expenses
Duty to repay extra ordinary expenses
Duty to indemnify for defective title
Duty to receive back goods

1. Duty to disclose faults

2. It is the duty of Bailor to disclose all the faults in bailed goods which are known to
him. If he does not disclose them he will be liable for the damages arising due to such
faults.
Example
Ali hires a carriage of Mehmood. The carriage was unsafe and Mehmood had not disclosed
that fact to Ali. Ali is injured. Mehmood is liable for the damages.
3. Duty to repay expense
When the goods are to be kept or carried by the Bailee. It is the duty of Bailor to bear all the
expense incurred on the bailed goods.
Example
Ali delivered a car to shahid for the safe custody. One tire of the car was burst on the way.
Shahid spent Rs.4000 to replace tire. Ali is liable to pay Rs. 4000
4. Duty to repay extra ordinary expenses
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If the extra ordinary expenses are incurred by the Bailee on the bailed goods then it is the
duty of Bailor to repay those expenses.
Example
Habib bailed his horse to Asif for journey. The expense for feeding horse is ordinary expense
and falls on Bailee but if horse becomes sick then it is the duty of Bailor to repay the
expenses incurred on the treatment of horse.
5. Duty to indemnify for the defective title
Where the title of goods to Bailor is defective and Bailee suffers loss due to such title, It is
the duty of Bailor to indemnify the Bailee for such loss.
Example
Ali gives his neighbors scooter to Bilal for use without neighbors permission. The Neighbor
files a suit on Bilal and received compensation. Ali is liable to compensate Bilal.
6. Duty to receive back goods
It is the duty of Bailor to receive back goods when the Bailee returns them after the
accomplishment of purpose
Example
Ali bailed his horse to Bilal to feed for two months. Ali does not take his horse after two
months. Bilal has to spend more to feed horse. It is the duty of Ali to compensate Bilal.

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Q#15 what are the right and duties of Bailee?

Rights of Bailee
Followings are the rights of Bailee
1. Right to recover damages
A Bailee has right to recover damages suffered due to fault in bailed goods that were
known to the Bailor
Example
Ali hires a carriage of Mehmood. The carriage was unsafe and Mehmood had not
disclosed that fact to Ali. Ali is injured. Mehmood is liable to compensate for the
damages.
2. Right to recover expense
It is the right of Bailee to recover expenses that were incurred on the bailed goods.
Example
Ali delivered a car to shahid for the safe custody. One tire of the car was burst on the
way. Shahid spent Rs.4000 to replace tire. Shahid has a right to claim for the expenses
incurred on the car.
3. Right to compensation
If Bailee suffers loss due to the defective title of goods to Bailor, The bailee has right
to claim for the compensation.
Example
Ali gives his neighbors scooter to Bilal for use without neighbors permission. The
Neighbor files a suit on Bilal and received compensation. Bilal has right to receive
compensation from Bailor.
4. Right to stop delivery
If the person other than Bailor claim bailed goods from Bailee, the Bailee may apply
to the court to stop delivery of goods to Bailor and to decide the title of goods.
Example
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Sheraz bailed goods to Faraz. Hammad claimed that he is the owner of goods and
demand goods form Faraz. Faraz can stop the delivery of goods to Sheraz and request
the court to decide the ownership of goods.
5. Right to sue
If an unauthorized person forcefully uses or take the procession of bailed goods, the
bailee has right to sue that unauthorized person. Bailor can also file a suit for those
goods.
Example
Ali gives a piece of cloth to Taylor to make a coat. Sheraz an unauthorized person
forcefully take the coat form Taylor and start using it. Ali or Taylor can file a suit
against Sheraz.
6. Right of lien
Lien means the right to retain the goods until he is not paid for the services rendered.
A bailee has a right to retain the bailed goods until he is not paid for the services
rendered.
Example
Ali gives his watch to Salman for repairing. Salman can retain the watch till he is not
paid for his services

Duties of bailee
Following are the duties of bailee
1. Duty to take reasonable care
It is the duty of bailee to take reasonable care of goods bailed. If he does not take care
of goods and the goods are damaged due to his negligence he is responsible for the
damages.
Example
Shakeel bailed his car to nazir. Nazir did not lock up the car. The car is stolen. Nazir is
liable for the damages
2. Duty not to make unauthorized use

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The bailee must use the goods according to the terms and conditions. If he makes an
unauthorized use of goods, he is liable for the damages to the goods.
Example
Ali gives his car on hire to Junaid for personal use. Junaid allows Faraz to drive but he
got accident and got injured. Junaid is liable to compensate Ali.
3. Duty not to mix the goods
If the Bailee without the permission of Bailor mixes the goods of Bailor with his own
goods in such a way that it becomes impossible to separate them, it is the duty of
bailee to compensate Bailor for the loss of goods.
4. Duty to return goods
It is the duty of bailee to return the goods to bailer as soon as the purpose of bailment
is accomplished. If he fails to return goods at specified time he is responsible to
compensate bailer for the loss.
Example
Ali bailed his horse to Bilal to feed for two months but Bilal does not return the horse
after two months. The horse dies after the period of bailment without any fault of
Bilals part. Bilal is liable for the loss.
5. Duty to return increase
It is the duty of bailee to return any increase or profit accrued from the goods bailed.
Example
Asad bailed a cow to khurram. Cow gave birth to a calf. It is the duty of Khurram to
return cow along with calf.

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Q#16 WHAT IS PLEDGE OR PAWN? WHAT ARE THE

ESSENTIAL FEATURES OF PLEDGE?
Pledge
The bailment of goods as security for the payment of debt or performance of promise is
called pledge. Or Bailment is the transfer of possession of moveable property by one person
to another person to get loan.
Example
Ali borrows 500 Rs. From saad and keeps his watch as security for the payment of loan. The
bailment of watch is called pledge.
Parties of pledge
i.
ii.

Pleger/ pawner
Plegee /Pawnee

Pledger / pawnor
The person delivering his goods as security is called pawner
Plegee / Pawnee
The person to whom the possession of goods is given is called Pawnee.
Features of pledge
1. Moveable property
A pledge is only valid when moveable property is pledged. It includes any kind of goods,
documents, valuables.
2. Transfer of possession
In pledge only the possession of goods is transferred by the pawnor to Pawnee
3. Not Transfer of ownership
In contract of pledge, ownership is not transferred from pawnor to Pawnee
4. Mere custody of goods
The person having only the custody of goods cannot pledge them. For example a servant
having the control of principals goods cannot make a valid pledge of them.

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Q#17EXPLAIN THE RIGHTS AND DUTIES OF PLEDGER

Rights of Pleger
1. Right to recover damages
Pledger can claim for the damages that arise due to pledgees negligence. He can also
claim damages arising due to unauthorized use of goods.
7. Right to demand return of goods
The Pledger has right to get back the goods Pledged after as soon as the payment of debt is
made. If Pledgee fails to return, the Pledger can claim for the compensation
8. Right to claim increase
The Pledger can claim any increase or profit, which may accrued from the Pledged goods.
9. Right to terminate Pledge
The Pledger has a right to terminate the Pledge if Pledgee does any act which is against the
terms and conditions of Pledge.
10. Right to sue
Pledger can sue Pledgee if he fails to return goods or breaches contract.
11. Compensation
If the Pledgee without the permission of Pledger mixes the goods of Pledger with his own
goods in such a way that it becomes impossible to separate them, the Pledger has a right to
claim for the compensation for the loss of goods.

Duties of Pledger
Following are the duties of Pledger
7. Duty to disclose faults
It is the duty of Pledger to disclose all the faults in Pledged goods which are known to him. If
he does not disclose them he will be liable for the damages arising due to such faults.
8. Duty to repay expense
When the goods are to be kept or carried by the Pledgee. It is the duty of Pledger to bear all
the expense incurred on the Pledged goods.
9. Duty to repay extra ordinary expenses
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If the extra ordinary expenses are incurred by the Pledgee on the Pledged goods then it is the
duty of Pledger to repay those expenses.
10. Duty to indemnify for the defective title
Where the title of goods to Pledger is defective and Pledgee suffers loss due to such title, it is
the duty of Pledger to indemnify the Pledgee for such loss.
11. Duty to receive back goods
It is the duty of Pledger to receive back goods when the Pledgee returns them after the
accomplishment of purpose

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Q#18 EXPLAIN THE RIGHTS AND DUTIES OF PLEDGEE

Rights of Plegee
1. Right to retain
The Plegee has right to retain the goods until his dues are paid. He can retain them for
payment of debt or performance of promise and all necessary expenses incurred by him for
the safety of goods
Example
Shahid borrowed Rs. 2 lac from Irfan and pledges his diamond ring. If shahid does not return
the loan shahid can retain the ring
2. Right to retain for the other debt
If the Pledger again takes loan after the first loan, Plegee can retain the goods over the second
loan.
Example
Ali borrowed Rs 400,000 from Sheraz and pledges his car. After 3months Ali borrowed
another sum of Rs. 300,000 and pays the first debt. Sheraz can retain the car against his
second loan.
3. Right to extraordinary expenses
The Pledgee has right to recover all those expense that are incurred on the safety of goods.
But Pledgee cannot retain goods if such expenses are not paid, he can only sue Pledger for the
recovery of extra ordinary expenses.
Example
Ali pledges his horse to Bilal. Horse falls sick and Bilal spent 400 Rs for the treatment of
horse. Bilal can sue Ali for the recovery of expenses.
4. Right to sell
If the Pledger refuses to make payment or debt or performance of promise, the Plegee has
right to sell goods after giving the notice of intention of sale to Pledger.
Following points must be considered.
i.
ii.
iii.

Reasonable notice is necessary.

Pledgee cannot sale goods to himself
If the amount recovered from sale is less than the amount of debt, he can recover
the balance amount from Pledger.
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Example
Ali pledges his car to shahid to obtain a loan of Rs 500,000. But on the due date Ali fails to pay
the amount of loan. Shahid can sale car after giving a notice of sale.

Duties of Pledgee
Following are the duties of Pledgee
6. Duty to take reasonable care
It is the duty of Pledgee to take reasonable care of goods pledged. If he does not take care of
goods and the goods are damaged due to his negligence he is responsible for the damages.
Example
Shakeel pledged his car to nazir. Nazir did not lock up the car. The car is stolen. Nazir is
liable for the damages
7. Duty not to make unauthorized use
The Pledgee must use the goods according to the terms and conditions. If he makes an
unauthorized use of goods, he is liable for the damages to the goods.
Example
Ali pledged his car to Junaid. Junaid start using it as carrier. Ali can sue Junaid for
unauthorized use
8. Duty not to mix the goods
If the Pledgee without the permission of Pledger mixes the goods of Pledger with his own
goods in such a way that it becomes impossible to separate them, it is the duty of Pledgee to
compensate Pledger for the loss of goods.
9. Duty to return goods
It is the duty of Pledgee to return the goods to Pledger as soon as the purpose of pledge is
accomplished. If he fails to return goods at specified time he is responsible to compensate
Pledger for the loss.
Example
Ali pledged his horse to Bilal for two months but Bilal does not return the horse after two
months. The horse dies after the period of bailment without any fault of Bilals part. Bilal is
liable for the loss.

Q#19 what is the difference between sale and

agreement to sell?

Basis

Sale

Agreement to sell

1. Transfer of
property

The property of goods passes from

the seller to the buyer immediately.

2. Transfer of
ownership

Ownership of the goods is

transferred immediately after the
sale
A sale can only be in case of
existing and specific goods only.

The transfer of property of the

goods is to take place at a future
time.
Ownership of goods does no
change until the property is
transferred.
An agreement to sell is mostly in
case of future and contingent
goods.

3. Type of goods

4. Risk of loss

5. Right to re sell

6. Nature of rights

7. Breach

8. Insolvency of
seller

9. Insolvency of
buyer

10. Nature of goods

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In sale the if the goods are

destroyed, the entire loss is
suffered by the buyer
In a sale the seller cannot re sell
the goods
The buyer becomes the owner of
goods. If the seller refuses to
deliver the goods the buyer can sue
for the recovery of goods
If the buyer fails to pay the price
the seller can sue for the recovery
of price

In an agreement to sale the whole

loss is suffered by the seller
It is merely a contract the buyer can
sue the seller for damages in case of
re sale of goods
The buyer does not becomes the
owner of goods and he can only sue
for the damages

In an agreement to sale, if buyer

fails to pay the seller can sue for the
damages not for the recovery of
price
If the seller becomes insolvent, the if buyer has paid the price of goods
buyer can recover the goods from
and the seller becomes insolvent, he
official receivers of seller because
can recover the price of goods but
buyer is the owner of goods
he cannot recover the ownership of
goods
If the buyer becomes insolvent and If the seller becomes insolvent
the price of goods is paid than his
before the payment of goods than
legal representative can demand the the seller can refuse to sale goods
goods from the seller. If price of
until the price is paid by the legal
goods is not paid, the seller can
representatives of the buyer
claim price proportionately
A sale is an executed contract
An agreement to sale is an
executory contract

Q#20
What are the rights of an unpaid seller?
Unpaid seller
An unpaid seller is a person, who has sold the goods for a price, but the price has not been
paid to him or the instrument which was given to him has dishonored.

Rights of unpaid seller

An unpaid seller has the following rights
A. Right against goods
B. Right against buyer

A. Right against goods

1. Right of lien
An unpaid seller has the right to stop the delivery of goods and to keep the goods in his
procession until the price is paid. If he has delivered a part of goods, he can stop the delivery
of remaining goods.
Seller can exercise the right of lien in the following cases;
i.
ii.
iii.

When the goods are sold on cash

When the goods are sold on credit and period of credit has been expired
When the buyer becomes insolvent

Rules regarding lien

Following are the rules regarding the lien of goods.
i.
ii.
iii.

When the goods are in the procession of seller

The seller can use the right only for the price, not for the other charges
If the seller has delivered a part of goods, he can retain the reminder

Example
a. A sells his car to b for Rs. 100,000 to be paid in cash. B fails to make the payment. A
can retain the procession.
b. A sold a machine to B for Rs. 2000, it was not working properly so B delivered it
back to A for repairs, it was held that A could not stop the delivery.

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2. Right of stoppage of goods in transit

When the buyer funds that the buyer became insolvent then he has the right of stopping
the goods in transit.
The seller can use this right in the following cases
a. When the goods are still in transit
b. When the property has not passed to the
buyer c. When the buyer becomes insolvent
d. When the seller has right of topping of goods in transit
3. Right of resale
A seller has the right to resale the goods if the buyer does not pay the price of goods.
Seller can use this right in following cases
a. When the goods are of perishable nature and the buyer fails to pay the rice
within reasonable time
b. When the seller has given the notice of his intention to resale
c. When he right to resale is expressed in contract between the parties.

B. Right against buyer

1. Price
If the seller has delivered goods and buyer fails to pay the price of goods. The seller has
right to sue for the price of goods.
Example
A Sold goods to B, B fails to pay the price. A can sue B for the recovery of price
2. Damages for non acceptance
When the seller has delivered the goods and the buyer refuses to accept them. The seller
has right to sue for the recovery of damages.
Example
A Sold and delivered goods to B, but B refuses to accept the goods and pay the price.
The seller has right to sue for the recovery of damages
3. Special damages and interest
If the buyer fails to make the payment at agreed time but he will pay late. The seller has
right to sue for the recovery of interest at reasonable rate.
Example

A Sold goods to B, B fails to make payment and promised to pay later. A has right to sue
for the recovery of interest
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