In most cases, the intention behind a treaty change is not important. However, if the modification was made with the intention of one party to defraud the other, the contract is considered invalid and the aggrieved party may appeal to a court. In United India Insurance Co Ltd v.M.K.J. Corpn, the judgment stated that “good faith is an ongoing obligation because one party cannot make a material change to the terms of the contract without the consent of the other party, even after the contract has been concluded.” If a contract contains language that describes the process for amending the terms and conditions and these procedures are followed, the contractual decisions have determined that these changes are valid. Therefore, the parties will act under the amended terms of the amended contract. In fact, it is a new treaty. The Blue Pencil doctrine makes terms or clauses that are inherently non-binding or illegal, making that part of the contract illegal and the other part of the contract enforceable. If the merged companies want to make changes to the business, they must also change the terms and conditions of the contract. In India, the employer cannot change the contract without informing the employee within the specified period. In addition, certain conditions of an insurance policy may be changed with the consent of the insured and the insurer. The main effect of the modification of the contract is that if the contract is modified with the consent of both parties, the contract is said to be valid and if it is modified without the consent of both parties, then the contract is said to be void.
(b) Unless paragraph (c) is provided, a fraudulent modification exempts a party whose obligation is affected by the modification, unless that party accepts the assertion of the amendment or is prevented from asserting it. No other change exempts a party, and the act may be performed on its original terms. A contract can usually be changed at any time, provided that all parties express their consent to the changes. Minor amendments to a contract can often be handwritten in the original document and then signed or initialled by the parties. Major changes to a contract often need to be renegotiated and are subject to further pressure and signature. If the contract contains specific instructions for the modification, these must be followed. A contract may also need to be amended for reasons other than the wishes of the interested parties. For example, a contract amendment may be necessary due to a legal requirement. Or a judge may order the modification of a contract in certain circumstances. Under the Indian Contract Act, the performance of the 1872 contract is legal and valid in India. The performance of a contract means the termination of a contractual relationship between the parties.
There are several ways to fulfill the contract. They are as follows: In addition, the new contract will be unenforceable for any reason, the old contract will be revived and the parties will have to fulfill their respective obligations. Contract changes can be made for a variety of reasons. In fact, there are as many reasons to modify a contract as there are to create one in the first place. Some common reasons why the parties modify the contracts can be: When the delivery was made well beyond 4 weeks, the buyer did not accept the service. The defendants argued that the buyer had waived its right to performance by its conduct by setting a lenient grace period. The court held that the buyer had asserted its right to determine the essential time when it gave notice of termination. Therefore, he was allowed to terminate the contract. If the contractual obligations between the parties are terminated by mutual agreement expressly or implicitly, this is called a consensual settlement.
Novation, modification and consideration are three types of compensation by mutual agreement. One of the ways to perform the contract is by mutual agreement. If both parties agree to perform the contract amicably, this contract will be executed by mutual agreement. Section 62 of the Indian Contract Act 1872 provides for the performance of the contract by mutual agreement. If the parties agree to replace a new contract or to cancel or modify it, the original contract does not need to be performed. There must be a mutual agreement between the parties to perform the contract. If a party has concluded the contract and wishes to modify the contract after the contract has been signed, it is legal to modify or amend the contract with the consent of both parties. When a new contract is concluded with changes to the terms of the original contract, the original contract is fulfilled and the parties must comply with the terms of the new contract. The parties are free to replace, cancel or modify the terms of the original contract. The contract can be avoided by mutual agreement in three ways, such as: In another case Juggilal Kamlapat v. N.V. At the international level, the Supreme Court of Calcutta also ruled that “for the novation to take effect, the amendment of the treaty must go to the root of the original treaty and change its essential character”.
If the parties do not change, the nature of the obligation in the new contract must be significantly changed, emphasizing the simple change in the terms of the contract. And if parties don`t change, it`s change, not novation. If one of the parties amends the contract without the consent of the other party, the contract is deemed null and void. The effect of a contract amendment without the consent of the parties is not specified in the Indian Contracts Act, but Indian practice allows common law authorities. In the event of unauthorized modification of contractual documents or conditions, the contract is considered null and void. There is no provision in the Indian Contracts Act regarding the unauthorized amendment of treaty documents. Indian courts follow the English rule for the same thing. The Blue Pencil Doctrine is a doctrine used by the courts to make certain parts of the contract void or unenforceable and other parts of the contract enforceable. In the Blue Pencil doctrine, words that are not binding or invalid are void and make other parts of the Agreement enforceable.
It is also called the doctrine of divisibility. Sometimes there is an amendment to the treaty where certain parts of the contract are modified, which is unauthorized and illegal, but with the help of the blue pencil doctrine, this change can be declared unenforceable as well as invalid and non-binding. A change is a change that affects the content of the contract expressed in the document or modifies the legal effect of the document that affects the document itself, in any case, when the identification may be important in the ordinary course of business. The amendment is not significant if it simply expresses what was already implied in the document or adds information that is consistent with the document in its current form. In the case of Pigot, it has been found that the substantive modification of a document by one party after its execution without the consent of the other parties invalidates it and that the change is not significant. The change of material must depend on both the type of instrument and the changes. If the change causes the contract to exploit it differently from the original, it is a significant change. An instrument is not unloaded by an immaterial change. The modification is considered insignificant if it does not alter the legal effect of the instrument or impose a higher liability on the beneficiary. An insignificant change does not affect the rights and obligations arising from a written form, regardless of the person by whom the change was made or for what purpose it was made.
In addition, a change made by the addition or modification of a counterparty statement does not normally alter the legal effect of an obligation is considered insignificant. In the case of Pigot, Coca-Cola found that if an act is altered by a foreigner, the act is called void. The modification is considered insignificant if the modification is signed in a document by the parties before its execution, provided that those who signed did not harm their interests. Sometimes a contract contains language that prohibits future changes. For example, the contract may contain a clause that states: “This contract is not subject to future changes.” If this is the case, it is likely that the other party will not accept any changes. .