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CMA Foundation · Fundamentals of Business Laws and Business Communication · Void and Voidable Agreements, No Consideration No Contract

Ravi agrees to sell to Sunil 'one thousand maunds of rice at a price to be fixed by Tarun'. Which statement is correct?

The agreement is not void for uncertainty. Section 29 voids only agreements whose meaning is not certain or capable of being made certain. Since the price is to be fixed by Tarun, it can be made certain, so the agreement stands.

  1. AThe agreement is void because the price is not fixed at the time of agreement
  2. BThe agreement is void because a third party cannot be involved
  3. CThe agreement is voidable at Sunil's option
  4. DThe agreement is not void for uncertainty because the price is capable of being made certainCorrect

Explanation

Under Section 29, an agreement is void only if its meaning is not certain and cannot be made certain. A price to be fixed by a named person, Tarun, is capable of being made certain, as the rice illustration shows. Option A wrongly requires the price to be fixed at the outset.

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