E – Contracts

E – Contracts

Author:- Mitali Kasat, a Student at Indian Law Society

E – contracts also known as electronic contracts are those contracts that are not paper-based contracts. They are based in an electronic form. They are mainly used for the speedy process of contracts. If two parties are living in different countries this form of contract is feasible. In India E – contracts are recognized under acts like the Information Technology Act 2000 and The Indian Evidence Act 1872. E – contract is a contract that is drafted, negotiated, and executed completely online. A customer drawing out money from the ATM is an example of e–contract. 

Nature of E-contracts: 

• In most cases, parties do not meet physically.

• No physical boundaries.

• No handwritten signature

• Most of the time, no handwriting is required.

• These types of contracts can be used in court as evidence.

• There is no single authority to major the whole process

• In case of breach of contract, the jurisdictional issues are major.

• The risk factor is high.

Essentials Of E-Contract

The essentials of E-contracts are almost the same as the essentials of a valid contract. like:

Offer:

They must be offered by one party to another party so that they can make a contract between each other. The offer is defined under section 2(a) of the act. Offer means the will or expression of one party to come legally into the contract with another party.

Acceptance:

There is a rule that the acceptance of the offer should be communicated to the offeror. Once the offer is accepted by another party. The contract will come into existence.

Revocation of offer and acceptance:

The parties should have the power to revoke the offer and acceptance before the time limit given in the contract.

Lawful consideration:

The consideration for the E-contract should be lawful.

Lawful Object:

The object of the contract should be lawful. Any contract where the object is against the public policies, the contract will be void and illegal.

Competent parties:

The parties to the contract must be competent to make a contract with each other. The party should not minor, unsound mind and be forbidden by law to make the contract.

Free consent:

The consent taken by all the parties to make the contract must be free consent.

Certainty of Terms:

There must be the certainty of terms and conditions between both parties.

Types Of E-Contracts

The main types of E-contracts are:

Click-Wrap Agreements:

While using any website or any software, we are very familiar with the “I agree” phase, and we press the button without thinking twice. However simple it may appear; it may land us in serious trouble as it gives rise to a legally enforceable valid contract. This type of contract can be legally enforced against the user.

Shrink-Wrap Agreements:

Shrink-wrap agreements are mostly related to computer software. The software is mostly distributed in CD-ROMs. When the licensing software is opened by the person for his use, it means he accepts the terms and conditions of that software company.

Browse-wrap agreements:

Browse-wrap agreements are probably seen on many websites while searching or reading anything on websites. There are some kinds of pop-ups that ask you to click “OK” or “I AGREE” though, you can use the website with or without clicking there.