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This article on 'Unfair Trade Practices in India: Legal Framework' was written by Shriharshini Balachandar, an intern at Legal Upanishad.

Introduction

Unfair trade practices refer to activities or practices that are deceptive, fraudulent, or unfair in nature and carried out by businesses or individuals to gain an unfair advantage over their competitors. These practices can cause harm to consumers, competitors, or the market as a whole. In India, various laws govern unfair trade practices, including the Consumer Protection Act, 2019, the Competition Act, 2002, and the Indian Contract Act, 1872. We will discuss the legal framework for unfair trade practices in India and analyze some significant case laws related to the topic. This article deals with the concept and laws regulating Unfair trade practices in India.

Unfair Trade Practices: Definition

The term "unfair trade practise" (UTP) broadly refers to a trade practise that adopts any unfair method or unfair or deceptive practise that is prohibited by a statute or has been recognised as actionable under law or by a court judgement in order to promote the sale, use, supply of any goods or the provision of any service.

LEGAL FRAMEWORK IN INDIA

The Consumer Protection Act, 2019 The Consumer Protection Act, 2019 (CPA) is a comprehensive legislation that aims to protect the interests of consumers in India. The Act defines unfair trade practices as any deceptive or unfair practice that is made by a seller in connection with the promotion, sale, or supply of any goods or services. It also provides for the establishment of the Central Consumer Protection Authority (CCPA) which has the power to investigate and prosecute unfair trade practices. Furthermore, the CPA has also introduced strict penalties for violations of consumer rights. The Act provides for imprisonment and hefty fines for entities found guilty of engaging in unfair trade practices. This has significantly deterred market players from engaging in such practices and has helped in promoting fair competition in the market. In the case of Hindustan Unilever Ltd. v. State of Rajasthan, the Supreme Court of India held that the promotion of a product by claiming that it has a unique or special property without any scientific basis is a deceptive trade practice. In this case, Hindustan Unilever promoted its product, "Pepsodent Germicheck," by claiming that it was "102% better" than other toothpaste brands, without providing any scientific evidence to support the claim. The Court held that such a claim was misleading and amounted to an unfair trade practice. Another important case that dealt with unfair trade practices under the CPA is the case of Cadila Healthcare Ltd. v. Dr. Reddy's Laboratories Ltd. In this case, Cadila Healthcare had challenged the marketing practices of Dr. Reddy's Laboratories, alleging that the latter had engaged in unfair and deceptive trade practices by making false and misleading claims about the efficacy of its product. The Court held that such claims were in violation of the CPA and directed Dr. Reddy's Laboratories to withdraw the advertisement and pay compensation to Cadila Healthcare. The Competition Act, 2002 The Competition Act, 2002 (CA) is another important legislation that deals with unfair trade practices in India. The Act aims to promote competition in the market by prohibiting anti-competitive practices. The act aims to promote and sustain competition in the market and protect the interests of consumers. The Competition Commission of India (CCI) is responsible for enforcing the provisions of the act and has been given the power to investigate and penalize entities that engage in anti-competitive practices. Under the CA, unfair trade practices are defined as those practices that distort competition in the market or are likely to do so. In the case of Maruti Suzuki India Ltd. v. Competition Commission of India, the Delhi High Court held that an agreement between two car manufacturers to fix the prices of their spare parts was an unfair trade practice. The Court held that such an agreement was anti-competitive in nature and violated the provisions of the CA. Another important case that dealt with unfair trade practices under the CA is the case of Pfizer Ltd. v. Union of India. In this case, Pfizer had challenged the decision of the National Pharmaceutical Pricing Authority (NPPA) to cap the prices of its drug. The Supreme Court of India held that Pfizer had engaged in an unfair trade practice by charging exorbitant prices for its drug, which was essential for the treatment of a life-threatening disease. The Court held that such a practice was exploitative and went against the public interest.

Unfair Trade Practices in India: Legal Framework Explained The Indian Contract Act, 1872 The Indian Contract Act, 1872 (ICA) deals with the formation and enforcement of contracts in India. the Indian Contract Act, 1872 plays a significant role in promoting fair and ethical business practices in India. The act provides for the requirement of free consent, the performance and discharge of contracts, and the enforceability of contracts. The effective implementation of the act would require the active participation of all stakeholders, including consumers, market players, and the authorities responsible for enforcing the law. Under the ICA, a contract that involves fraud or misrepresentation is voidable at the option of the aggrieved party. Therefore, any unfair trade practice that involves fraud or misrepresentation can be challenged under the ICA. In the case of A.V. Fernandez v. State of Kerala, the Supreme Court of India held that a seller who conceals material information about a product while selling it to a buyer is guilty of unfair trade practice. In this case, A.V. Fernandez had sold a car to the complainant without disclosing that the car had met with an accident in the past. The Court held that such a practice was fraudulent and amounted to an unfair trade practice. Another important case that dealt with unfair trade practices under the ICA is the case of Indian Oil Corporation Ltd. v. Amritsar Gas Service. In this case, Indian Oil Corporation terminated the dealership agreement with Amritsar Gas Service on the ground that the latter had engaged in malpractices and had indulged in black marketing of LPG cylinders. The Court held that the termination of the agreement without any prior notice or opportunity of being heard was an unfair trade practice and went against the principles of natural justice. Other relevant legislation Apart from the above-mentioned legislations, various other laws in India address specific unfair trade practices. For instance, the Drugs and Cosmetics Act, of 1940 prohibits misleading advertisements for drugs and cosmetics. The Securities and Exchange Board of India (SEBI) has also issued regulations to curb insider trading and other unfair trade practices in the securities market.

Suggestions

- The government and regulatory bodies should work to increase awareness among consumers and businesses about the legal framework regarding unfair trade practices in India. This can be done through various mediums like seminars, workshops, and social media campaigns. - There should be stricter enforcement of the existing laws, and the government should ensure that the regulatory authorities have the necessary resources to carry out their duties effectively. This will act as a deterrent to businesses engaging in unfair trade practices. - The complaint filing process should be simplified and made more accessible to consumers. This will encourage more people to come forward and report instances of unfair trade practices.

Conclusion

Unfair trade practices are a menace that can harm consumers, competitors, and the market as a whole. Therefore, it is essential to have a robust legal framework to deal with such practices. These laws provide stringent penalties and compensation mechanisms to deter businesses from engaging in such practices. Through the case laws discussed above, we can see that the courts in India have been vigilant in enforcing these laws and protecting the interests of consumers and competitors. It is essential for businesses to be aware of their obligations under these laws and to ensure that they do not engage in any unfair trade practices. In conclusion, the legal framework for unfair trade practices in India is robust, and the courts have been proactive in enforcing these laws to ensure a fair and competitive market.

References

This article on "Legal validity of Minor's agreement in India" was written by Shudhi Malhotra, an intern at Legal Upanishad.

Introduction

This article discusses the Legal Validity of the Minor's Agreement in India and its provisions and case laws related to it. The Indian Contract Act, 1972, Section 10, states that not all agreements qualify as contracts. Only agreements signed by parties who have the legal capacity to do so are considered contracts. Furthermore, Section 11 of the Indian Contract Act defines "capable" as including the following three criteria: - The individual must be of legal age, or at least 18 years old. - When the contract is made, he should be competent to enter into it. - Any law that he is subject to shouldn't prevent him from signing contracts. Before engaging in a contract, it might be argued that majority approval is necessary.

Who is a minor?

A minor is an individual who does not have the same legal rights as an adult because they are under the legal age of majority as defined by the regulation of the jurisdiction in which they live. Generally speaking, a minor is someone who has acquired all of the rights and obligations of an adult but has not yet achieved the age of majority. Minor cannot be held accountable or responsible for their conduct. The typical majority age is 18 years old. However, as the permitted drinking age in the United States is generally 21, even if a person is at least 18 years old, they may still be referred to as juvenile in alcohol legislation. A minor is a person who has not attained the age of 18 according to Section 3 of the Indian Majority Act of 1875. If a custodian of a minor's individual or belongings is assigned, the minor becomes 21 years old.

What is Minor's agreement?

Any person who is of legal age under the decree to which they are subject, who is of sound mind, and who is not prohibited from contracting by any ordinance to which they are subject is capable of agreeing, according to Section 11 of the Indian Contract Act of 1872. Therefore, a minor cannot engage in a contract. AGE OF MAJORITY: Section 3 of the Indian Contract Act of 1875 means that any individual residing in India reaches adulthood when they turn 18 years old. Exceptions: 21 years in the following lawsuits: - In cases where a guardian of a minor's individual or belongings has been assigned by the Guardian and Wards Act of 1890. - When property belonging to a juvenile has been transferred under the control of the bench of remarks.

The effects of minor's agreement

The results of this momentous decision can be stated by there is no contractual or tort liability: A minor is incapable of giving permission, and any agreement they make is invalid and cannot be implemented because of this. Rule of Estoppel: It is a lawful principle of proof that forbids a party from causing an allegation that is inconsistent with what he has already said. The tribunal ruled that the estoppel theory does not lay in cases when the individual involved already understands the existence; in this instance, the defendant's attorney was familiar that the complainant was a minor. This regulation does not thus lay on. Restitution of benefit: Section 64 of the Indian Contract Act means that when a party who has the opportunity to nullify an agreement does so, the further party is not required to fulfill their obligations under the contract. This is true for voidable contracts, but a minor's contract is void, thus he cannot be required to pay the finances back to the lender.

The exception in the generally applicable rule

For protecting minors. His agreement is unlawful since it shielded a child. But there are also some exceptions. Upon completion of the minor's duty: A minor may be both the promisee and the promisor in a contract, but not both. If the juvenile is in the role of the promisee and has upheld his end of the bargain but the other party hasn't, he or she may be able to enforce the contract. An agreement made by the minor's guardian for his advantage: A minor may then file a lawsuit against the other party if it breaks its assurance. In the lawsuit of Great American Insurance v. Madan Lal, the custodian of the minor's property signed an insurance contract on behalf of her son. The insurance refused to pay out when the belongings were sabotaged and the minor requested reimbursement, claiming that an agreement with the minor is invalid. Delinquent, however, the bench ruled that this agreement was valid, and he is now required to make restitution. The Contract of apprenticeship: A contract of apprenticeship entered into by a custodian on behalf of a child under 18 years is enforceable under the Indian Apprentices Act of 1850.

Legal validity of Minor's agreement in India

Necessity supplied to a minor

If someone unable to engage in a contract is given the requirements of life by another person, even a child, the person who assisted is entitled to compensation from the incompetent person's property. However, the youngster cannot be forced to pay back the other person if he has no property of his own.

Case Law

Mohribibi vs. Dharmodas Ghosh (1903) Facts The complainant, Dharmodas Ghosh, loaned a juvenile Rs. 20,000 while he was still a minor by pledging his belongings to the defendant, a moneylender. The defendant's attorney was then aware of the plaintiff's age. Later, the plaintiff consented to pay Rs 8000 but vetoed the balance. He sued the defendant, claiming that because he was a minor at the time the contract was formed and as such, he is not obligated by the agreement, on behalf of his next friend and current legal guardian, the plaintiff's mother. Decision According to section 11 of the Indian Contract Act of 1872, minors are not permitted to engage in contracts, the privy council ruled in its ruling. Section 11 of the Indian Contract Act of 1872 provides that every individual who is of the age required by the ruling to which they are subject is competent to contract. Any agreement with a minor is therefore Void ab initio. A valid contract is stated to satisfy all of the conditions outlined in section 11. The court further ruled that the agreement with the minor is void. A minor cannot enter into a contract, hence the mortgage was void. The minor is not obligated to keep any promises he made in connection with the contract, thus he cannot be forced to reimburse the finances that were granted to him. Additionally, the minor is not covered by estoppel legislation.

Can a minor be a partner?

The formation of a contract results in the formation of a partnership, and both parties to the contract must be of legal age. The minor may, however, be accepted to the advantage of the coalition for the period being with the proper approval of all the members, as an exemption under Section 30 of the Partnership Act. But he won't be held responsible for any of his actions.

Conclusion

A minor is not allowed to come into a contract under the Indian contract Act, of 1872 and such a contract would be null and void from the beginning. Minor cannot rely on the ratification of the agreement he reached during his minority when he becomes a member of the majority. A contract that was void in the past cannot be made lawful later on because ratification refers to a time when the individual was still a minor. After reaching the age of the majority, a new contract may be made with new considerations if necessary. Furthermore, a minor's agreement cannot be demanded to be performed specifically since doing so would mean carrying out a full agreement. A youngster will only be held accountable for claims for necessities, though.

References

This article on 'Breach of Contract in Australian Laws' was written by Aditi Amarawat, an intern at Legal Upanishad.

INTRODUCTION

The contract refers to a set of promises from two or more parties that is legally binding. Every country has laws and statutes governing the requirement for a legally enforceable contract also called a valid contract. For the sake of protecting the interests of all the parties involved in a contract countries lay down a set of laws to provide the same, these laws are called the laws of the contract. In this article, we will examine the concept and laws regulating the breach of contract in Australia.

AUSTRALIAN LAWS

The notion of contract laws was introduced in Australia with the arrival of the British. Australian contract laws are not codified such as the Indian contract act, they are loosely based on the British common law with the basic principles of freedom of contract. (Ultz, 2015). Australian laws cover contracts being made in every sphere of business we must understand what a contract consists of.

ESSENTIALS OF A CONTRACT

Since Australia doesn’t have single legislation governing this topic multiple laws in place mention the requirements of a contract. Australian law does not require the contacts to be written except in some prescribed cases such as a lease or property transfer. According to the laws covering contracts in Australia, 5 elements must be present for a contract to be legally enforceable. - There must be an agreement between all the parties involved in the contract. The contract cant is unilateral in nature. - There should be something that can be given from both the parties involved to each other such as money or materialistic goods this is called consideration. - Both parties must have the capacity to enter into the contract, such as being of sound mind and having attained legal age. - Both parties must have the intention to enter into a legal relationship. - The parties must enter in good faith with the certainty to complete their part of the bargain. (Australian contract.info, 2015) Blomley Vs Ryan (1956) Ryan being heavily intoxicated agreed to sell his farm to Mr. Blomley, after the contract was challenged it was held that a heavily intoxicated person could not be seen to have the capacity to enter into a contract.

BREACH OF CONTRACT IN AUSTRALIA

A breach of contract in Australian laws refers to the unfulfillment of any key terms of the contract by one of the parties. Since most of the contracts may or may not be written down it becomes difficult for the parties involved to determine if there has been a breach of contract. As far as the breaches are concerned they can be categorized into four categories. (Douglas, 2020) - A fundamental breach is the most severe and common breach to be found, it is also known as a material breach. This breach refers to instances where an integral part of the contract has not been fulfilled by a party. - if you order a set of sofas and only a cushion arrives the retailer has materially breached the contract. - A minor breach is much less severe and will not lead to an immediate cancellation of the contracts. - If the retailer had sent the whole sofa set but didn’t send the instruction manual it will be a minor breach that cant lead to a cancellation. - An anticipatory breach is a kind where a party informs the other parties in advance about them not performing the respective tasks until a certain period. - Even though such breaches are pretty rare in nature it still entitles the other party to remedies. - The actual breach is the most common breach, it refers to the refusal by one of the parties to perform their end of the bargain when the time comes. when a party becomes certain their contract has been breached by the opposing party they must immediately inform the concerned party of the same.

Breach of Contract in Australian Laws: All You Need to Know HANDLING A BREACH DISPUTE Once the breach has been communicated to the defending party they can take one of the following routes according to the Australian legislation. (Legal service commission) - The party which allegedly breached the contract can dispute the occurrence of a breach - They can point out any clause from the contract contradicting the claims of a breach - The party can even dispute the validity of the contract - Or lastly, the party to the breach can acknowledge the breach and try to provide remedies. The burden to prove that the breach has taken place is on the party that alleges the breach.

DEFENCES FOR BREACH

There are a plethora of arguments that a party can present to defend itself from the breach allegations, some of the most common ones are; - The commencement of the contract will be against public policy. The party can challenge the legality of the said contracts. - DiGesu v. Weingardt Both parties decided to split a liquor license and open it in two different locations. The said contract was taken to court by DiGesu since the regulations of the locality only allowed for a certain no. of liquor shops. The judgment by justice Franchini held that a contract with terms violating public policy would be held void. (Easley, 1978) - If the performance of the contract becomes an impossibility the contract cant is said to have been breached. - If X wants his house painted and employs Y for it, but later the house burns down, Y cant is held liable for breach of contract as painting the house became an impossibility. -  A party can also claim to have been under undue influence and demand the contract to be rescinded, which means it would be as if the contract never existed. - If a party can be alleged to have unconscionable conduct which disability or weakness while knowing such a weakness. - In the aforementioned case of Blomley Vs Ryan (1956) where the defendant knew about the intoxicated state of the plaintiff and used it to buy the farm. - The contract would also cease to be enforceable if it can be proven that there has been a mistake or misrepresentation of facts related to the contract.

REMEDIES FOR BREACH

Once a breach has been proven by the plaintiff party, the court can further award kinds of remedies to the plaintiff. Damages or specific performance (Leeks, 2019) DAMAGES The damages are the most common form of remedies awarded by courts as specific performance may not be in the jurisdiction of a magistrate judge. The kind of damages being awarded by courts in Australia can be categorized into 2 categories. COMPENSATORY DAMAGES These damages are awarded to the non-breaching party for the losses they have incurred due to the breaching of the contract. Such losses must be generally necessarily incurred by the party. The losses can be direct and general or can be specific and under special circumstances. Compensatory damages are the most commonly awarded damages in contract cases. EXEMPLARY DAMAGES These damages are to “punish” a wrongdoer and to be made an example of, these damages are not paid for the loss incurred but to demotivate others from doing the same. Exemplary damages or punitive damages are mostly awarded in tort cases, they are a rarity in contract cases. CALCULATING THE DAMAGES The calculation of general damages is mostly done by a standard measure. Such a measure looks towards the profits the plaintiff (non-breaching party) would have made had the breach not happened. If such a number is speculative or cant be agreed upon, the damage must be equivalent to the amount the non-breaching party spent in performing their end of the contract. (University of New Mexico) SPECIFIC PERFORMANCE In some instances, the court can order the completion of the contract even after a breach has been made. For an order of specific performance, the court must make sure that; - There is a legally binding contract - A breach of contract has taken place. Once both these prerequisites are met, the court can order to enforce the terms of a contract. (Turnbill, 2020)

SUGGESTIONS

- CODIFICATION the laws related to contracts need to be codified and be bound under legislation to remove ambiguity and make it more clear. - CLASSIFICATION many clauses under different legislations seem to overlap with each other without any legal explanation. - CLEAR PROCEDURES a lot of laws and clauses related to definitions or evidence along with the procedure to be followed are highly unclear.

CONCLUSION

The Australian contracts law mostly focuses on consumer protection and their rights, it is not a written set of laws and does not fall specifically under any legislation. Due to the vague nature of contracts and being dominant oral nature rather than written, judging a breach can be a tricky task for a court. There is a lot of room for improvement in the legislation but it certainly acts as a set of rules to guide and protects the right of Australian citizens against big corporates and even the state.

Bibliography