- Definition of Obligations
- Elements of obligations
- Inclusions of Obligations
- Kinds of Obligations
- Solidary Obligations
In general sense, term obligation is popular as a synonym of duty. Legal sense is little different to general. In legal sense obligation means a class of duties which are co-relative of rights in personam which means right of a particular person.
2) Definition of Obligations
Obligation is a legal bond between two individuals which control each other not in all respect but just to perform any particular action. Obligation is that part of law which creates right of one person over another. Right of one person is duty of another.
3) Elements of obligations[i]
There are following elements of obligations-
- The obligor: the person who has a duty to perform in the legal bond called obligation.
- The obligee: the person who has a right. He is entitled to demand the fulfillment of the obligation.
- The prestation: this can also be called subject matter of the obligation. There is always some act which is needed to be performed by one person on demand of the other.
- Legal bond: for obligation it is required that the legal enforceability must be attached to it.
4) Inclusions of obligations
There can be following situation which are included in obligation in juristic sense-
- There is always a duty in personam, which can be any duty of one individual in respect to another. For example, duty to pay a debt, a duty to pay compensation to whom the wrong was done or duty to perform any contract against other party of the contract.
- There is always a bond of legal necessity which is called by Roman jurists as vinculam juris which means obligation is not only a duty but it is co-related to a right of other individual. For example, in sale, seller is under obligation to deliver the possession of goods purchased by purchaser on receipt of money.
- Obligation is also considered as a proprietary right in personam which means a duty related to a right of other person. There are certain rights which are created from the status of a person but they are not obligation under law because of unenforceability. For example, rights created by marriage.
5) Kinds of Obligations[ii]
Obligations can be divided into following classes as per the law-
- Contractual obligations
- Delictal obligations
- Quasi-contractual obligations
- Innominate obligations
i. Contractual obligations-
- Contractual obligation means a duty which occurs from the contract. A contract is a legal bond between two persons. It creates right for one person and the duty for the other person. Both the parties of contract are responsible to act according to the terms of the contract for the benefit of each other.
- The right which comes into picture by virtue of contract is right in personam, which means right against the particular person who is the party of contract.
- In contractual obligations person who breaches the contract is liable to pay to the other person pre-fixed compensation as per the conditions and terms of the contract.
ii. Delictal obligations-
- These obligations are connected to torts. Tort is a branch of civil law. Tort is recognized in India as well as in U.K. whenever there is a civil wrong for which action has been taken for unliquidated damages it is called Tort.
- Tortious liability is the liability of wrong doer or defendant towards the victim or plaintiff. In such obligations there is a liability to pay compensation in form of money to the sufferer. For the purpose of such obligation term tort is confined with situations where for a civil wrong the only remedy is action for damages/compensation.
- Mere breach of contract or mere breach of trust cannot be considered as tort. Situation in tort is different to situation in contracts. In tort duties are fixed by the general laws but in contracts duties are specified for the parties.
- In contract there is always an enforceable agreement between the parties and duties arising from such contract cannot be imposed on third person who is not the party to such contract.
- In tortious liability there are always unliquidated damages that are claimed but in case of breach of contract the claimed amount is always pre fixed by the parties.
- To differentiate between tort and other wrong one should always keep in mind that a criminal wrong is different than tort. Tort is a civil wrong however there are certain wrongs which fall in both categories, for example, defamation, nuisance, malicious prosecution etc.
- A civil wrong can become tort only when claim for damages has been initiated by plaintiff against a wrong doer in court of law.
- If any civil wrong occurs by breach of law it will not come within the scope of law. However for the person who has suffered loss due to such wrong remedies are available in both breach of contract and tort as well.
- Breach of trust and breach of contract are not covered under law of tort. Hence there is no tortious liability that occurs in such type of cases.
iii. Quasi-contractual obligations-
- These obligations are regarded by law as contractual though they are not actually. Quasi judicial obligations resemble to the contractual obligations.
- A money decree by court is the example of quasi-contractual liability. In such case the decree holder gets the position as creditor and judgment debtor as debtor. Money decree judgment creates a debt where judgment debtor is liable to pay the amount fixed to the decree holder. Though this was not a contract but still there is a duty to pay.
- Under Indian Contract Act 1872, in chapter V from section 68 to 71 provisions are given which deal with situations where certain relations resemble to those which are created by legal contract.
- If a person provides to other person necessary things for his life, he has a right of reimbursement of value of things provided. If the other person is lunatic and incapable of making a contract, his family is liable to reimburse from the property of lunatic.
- If a person ‘A’ gives his land on lease to ‘B’. A pays the revenue of such land to government. Due to the failure in revenue payment government wants to sell such property but B makes necessary payments. B is entitled to get reimbursement of such money from A.
- If one person leaves his thing mistakenly at the place of other and the other person makes use of it, latter is liable to reimburse the former. Situation is different if the act was gratuitous which means that the person who leaves thing is voluntarily leaving it for the use of other person. No reimbursement is required.
- In case of State of West Bengal vs. Mondal and Sons[iii] it was held by Supreme Court that if state requested for certain works related to the construction, It could not reject the same. Though state had the right to deny and demolish the construction but once it was accepted it could not be denied. Hence Court held that State Government was liable to pay the cost of construction to the contractor.
- If a thing is delivered by mistake or through coercion, or money is paid to a person such person is liable to return such thing or to repay such money to the other person.
iv. Innominate obligations –
The obligations which do not fall under any of the above categories, they fall in this category. The obligations which are to be fulfilled by the trusties for the benefit of their trusts or other equitable obligations which are covered in modern property laws come in this category and called innominate obligations.
The obligations of such nature are recognized in Indian Trust Act 1882. Certain obligations are given in the act related to the trusts. It provides that a person who holds the property of other person must perform same duties and liabilities as if he were a trustee of the same property for the benefit of such person whose property he is holding.
There are certain circumstances under law of trust where obligations called innominate obligations are created-
- Section 81 lays down provision for situation where the intention of transferor to dispose of his beneficial interest is not clear.
- Section 82 provides that if transfer is being made to one person but consideration is being paid by the other person.
- Section 83 says that where the property of trust is not exhausted and trust is completely executed.
- Section 85 provides that where transferor transfers the property for trust but it is illegal.
- Section 87 provides that where any debtor becomes the executor of creditor the debt money with him must be for the benefit of persons interested for whom the trust was created.
- Section 88 deals with the obligations where advantage is gained through undue influence.
6) Solidary Obligations-
There is a general principle that the person who is getting benefit or has the right through this concept is called the creditor and the one who is bound by this or has the duty is called debtor.
Obligation is a right particularly against an individual. It cannot be enforced against the world. Generally there is one creditor and one debtor. One has a right over the other or can be said that one has the duty towards the other. However, there can be situations where there are two or more than two creditors, same way there can be two or more than two debtors as well.
In case where there is two or more than two debtors own debt from one common creditor, it is called solidarity obligation. In the case of two or more than two creditors the principle of joint tenancy or co-ownership works.
Concept of obligation is co-related with concept of liability. There is always a right of one person over the other person who is duty bound to do or not to do anything against such person. Obligation cannot be equalized with liability as there is a huge difference. Obligation is a proprietary right in personam but liability is a duty of wrongdoer to compensate the sufferer.
It is very important to mention that there can be no right without a duty. The concept of obligation covers the both right and duty from the legal point of view. Obligation is like a legal tie which bound two persons for the benefit of each other for a particular action not in all respects.
It can be called as law of everyday life. If there is no such concept of obligation situation like chaos can occur in society. From the legal point of view it is very important to bound people to perform their part of duty towards the other and on the other hand the other person enjoys right over former.