Introduction
India is a country where there is a diverse culture and social behavior. India has one of the oldest and finest legislation in the world that pertains to various laws and regulations. Laws are evolving day-to-day and all laws are made for the well-being of the public or for the public good. Laws differ in accordance with the jurisdiction and the enclave. Legal terms such as Tort and Contract are always confused by the layman. And they are misunderstood when used by the technical jargon. Often these two words are quite confusing when suit is proposed before them as they are hardly used in our day to lives. This article will help you to understand the major difference between Tort and Contract.
What is Tort?
The term tort was introduced in the 1580s which means a ‘civil wrong’. It is derived from a Latin word and is considered to be “a conduct which is not straight or lawful, but on the other hand, twisted, crooked or unlawful”. In Rome, tort could be considered to be equal to the term delict. As the name states, people are expected to behave in a straightforward manner than being crooked, then they are said to commit a tort. In law of torts, the wrongdoer violates a few legal rights bestowed on another person. Tort is considered a breach of duty in the eyes of law.
Some definitions of tort are –
“Tort is said to be a civil wrong for which the remedy is common law action for unliquidated damages and which not exclusively the breach of the contract[1] or a breach of trust. Any civil wrong which is not a ‘breach of trust or a breach of contract’ is a tort.”
“A tort is an act or omission which prejudicially affects a person in some legal private way”[2]. It is an infringement on one’s rights.
“Tortuous liability arises from the breach of a duty primarily fixed by law”.[3]
If any person commits a tort with negligence, that person is responsible to provide compensation for the damage caused in the way of monetary compensation. The main aspect of the law of tort is to render justice to the aggrieved party and to provide justice with fairness.
In a famous case Barnett v. Chelsea and Kensington,[4]The plaintiff has arrived at the hospital in the case of emergency and told the doctor that he has stomach pains. He was sent home without being examined by the doctor and as a result, the patient died. Though the doctor has a duty of care towards the patient and the legal duty is breached. The doctor was not held liable in this case.
Meaning of the Word ‘Law of Tort’
In India, the concept of tort in English laws has more scope than the law of tort from other laws (Hindu law or Muslim law). This mainly focuses on the principles like justice, equity, and good conscience. This law has not been adopted as such but only selective laws are applicable in India. The objective of the courts is to uplift justice in the society, if the English laws tend to modify or replace our common laws, the court can bring in new rules. In a famous case, Justice Bhagwati insisted that modification of laws has to take place due to industrialization in the economy. We should create our own jurisprudence and accept the source irrespective of whether it is from foreign or from England.[5]
Even in another famous judgment, Sahai J, the law of tort is based on morality. For the development of the society, and for the growth of the economy, having a liberal tortious liability is more advantageous than having so strict.[6]
The main aim of the law of torts is to abstain a person from committing harm to another person, and if in case the harm is committed, it helps to pay for the damage caused (compensation). The law of tort usually happens either by omission or commission of an act. The court may not provide liability for an inevitable accident, an act of God; unliquidated damages are provided for the plaintiff. It deals with various theories of strict liabilities and negligence.
Some examples of Tort
Interfere with the possession of other person – Trespass
Damaging another person’s reputation – Defamation
Defrauding other person- Deceit
There are multitudinous torts including trespass, assault, battery, negligence, products liability, and causing emotional anguish. There are also separate areas of law of that includes nuisance, defamation, invasion of privacy, and a category of economic torts.
What is a Contract and What are the Ingredients of it?
Contracts may be a set of a promise/promises which is legally constrain between parties. Contracts creates a binding relationship between the parties. They have the liberty to form a contract according to their interest. But these contracts should be for a legal purpose or they shouldn’t be done for any illegal purpose or any unlawful purpose. In contracts there can be two or more parties. In which one party makes an offer and the other parties accepts the offer. In case of breach of a contract (if one person fails to perform the contract), affected parties or the party has faced any loss can seek the court for redressal. A contract is created with respect to the autonomous.
Historical Development
Contracts are formed or commercial purposes and business. In the primitive society, individuals have various commitments to be performed. For instance, either by kinship or by religion. Contracts usually takes place with the exchange between the parties i.e., consideration is very important. Earlier barter system was followed in our society, where people exchange one production in exchange of there. If the seller provided any defective good, only the property laws were pertaining in the society and no contract law was identified. Later credit system was introduced. Then, people claimed based on unjust detention of the other parties to the contracts rather than a promise or a bargain.
Contracts are legally binding between the parties, they can be either oral or written. They could be either implicit or explicit.
A contract can be defined as a legal agreements between the people, companies[7]. The promises are enforceable in case the injured party is allowed to access the legal damages.
An agreement made between two or more persons which-
Is intended to be enforceable law and is constituted by acceptance of One party of an offer made to him by the other party to do or to Abstain from doing some act, An agreement made between two or more persons which Is intended to be enforceable law and is constituted by acceptance of one party of an offer made to him by the other party to do or to Abstain from doing some act an agreement made between two or more persons which is intended to be enforceable law and is constituted by acceptance of one party of an offer made to him by the other party to do or to abstain from doing some act.
An agreement made between two or more persons which is intended to be enforceable law and is constituted by acceptance of One party of an offer made to him by the other party to do or to Abstain from doing some act. An agreement made between two or more persons which is intended to be enforceable law and is constituted by acceptance of one party of an offer made to him by the other party to do or to abstain from doing some act.
Law of contracts lays down the essentials of a valid contract, and how they are enforceable and the parties to the contract decides the liabilities in case the parties fail to perform their contract. All the contracts bind the parties and an obligation to perform as per the contract.
Essential Ingredients of a Contract
- Offer
- Acceptance
- Consideration
- Agreement
These are the essentials that are bound by the parties to the contract.
Damages like restitution, liquidated damages, nominal damages and in some case, punitive damages may also be awarded.
What is a Privity of Contract?
It is a famous doctrine, that states a contract can’t bestow the rights or impose any kind of obligation upon any individual who has no relevance the contract.
Only the parties to the contract should enforce the terms of the contract. The parties who are outside to the contract should not benefit or they can’t be held liable under the contract.
Example:
If A and B entered into contract, B stayed as a tenant, when C can’t interfere with the affairs and get into the contract.
In Donoghue v. Stevenson, the ginger beer was sold to the retailer, they contained a small snail which was found in the bottle. When the lady drank those and was ill. She sued the manufacturer of the ginger beer for the negligence of him. Here, though the manufacturer and the consumer has no contract between them, the manufacturer has owned a duty of care and they are liable if there is a damage or defect in the product. Thus, the prevailing of the tortious liability has no relevance with the contractual liability.
Torts & Quasi-contract
This is a situation in which one person is liable to the party even without an agreement between them or there is no monetary benefit to which to which the party could claim. It is said that it is a hypothetical contract by the law.
There is no duty of care between the parties either in the repayment of money or any other benefits like torts. They have liquidated damages whereas the torts have unliquidated damages.
Quasi contract is more likely to torts and they are also formed by law and not by agreements.
Difference between a Tort and Contract
In common law the difference between tort and contract are well grounded, they both have varied objectives and guidelines. In contracts, the actions are produced to effectuate the agreements between the parties.
In tort, it exculpates the social policy. Contract is generally based on the consent of the parties. The law of torts and contracts can be differentiated in various means, most prominently they are based on the authorities and the various ways to enforce them.
Usually, the contracts focuses on breach of the contract and the tort is pivoted to the rights of the individuals they provide them with remedy.
1. Meaning
Tort: It is a collection of legal remedies that grants the aggrieved party to recover from losses, injuries, or damages. It is generally considered to be a breach of legal duty or obligation.
Contract: A contract is a promise or set of promises that the law would or will enforce if any phenomenon arises.
2. Nature of the right contravened
Tort: It is considered as the violation of a legal right. Here right in rem is violated (the rights are available to the world and the rights are vested with the individuals).
Contract: It is considered as an infringement of a legal right. It infringes the right in personam (this right is explicit to a person or any specific body).
3. Privity
Tort: Privity does not subsist and it isn’t much significant as the harm caused is tendered against the will of the aggrieved party.
Contract: Subsist in contract.
4. Rights and obligations
Torts: In case of tort there is no obligations and rights are created by the parties, but they arise by law.
Contracts: Whereas in contract the rights and the obligation is created by the parties to the contract. Here, the obligation is created due to the agreements between the parties.
5. Duties
Tort: Law is the determining party, law states the duties of the individuals. In torts the parties can’t determine they are bound or not as the court establishes law and everybody is bound by them.
Here, in torts people should have a legal duty of care towards a whole community and the court determines the liability for the tort committed.
Contract: In contracts, the parties to the contract predominantly establish the duties. The parties to the contract has the right to conclude whether they are bound or nor bound under the law of contract.
In contracts they are liable only to the parties to the contract and here the parties decide the compensation they want (Unliqidated Damages).
6. Minors
Tort: In tort they can be sued and they are responsible to pay the damages in the distinction of the court. The damages will be indemnified from the property of the minor.
Contract: In contracts, Minors have a limited liability.
7. Period of limitation
Torts: The period of limitation will scamper at the when the harm is caused to the party.
Contract: Here, in contracts, the limitation period scampers at the time the contract is breached by either of the parties.
8. Damages availed
Torts: The damages availed by the court are generally the unliquidated damages. They can also be a real or contemptuous damages.
The measure for the compensation is not limited by the court, rather it is with the discretion of the court. Punitive damages could be availed in torts.
Contracts: They hardly have the exemplary damages. The contracts usually decide the damages required in lest of breach of a contract. Here, the measure for the compensation is based upon the level of damages caused. Any person can’t recover the punitive damages under the contract.
9. Motive
Torts: In tort motive is a significant factor. The court takes motive of the person in consideration while proposing the judgement.
Contracts: The motive factor is irrelevant.
10. Parties to the Contract
Torts: In torts,
(i) The parties are not known earlier or (Trespass of a property)
(ii) In some cases they can be known. (Medical malpractice of a doctor)
Contracts: Here, the parties to the contract are known to each other. They form a contractual agreements.
11. Limitation Statute
Both in torts and in contracts, they both have a unique circumstance of the statute of limitation.
Tort: it has a short statute of limitation.
Contracts: it has a longer statute of limitation than tort.
12. Rights and responsibilities
Tort: Tort is a means where the rights and the duties of the general public is identified and the kind of a social behavior that is defensible. Tort describes on how a person should be acting to another parties.
Contracts: Contracts are means where the rights and duties of the parties are established those who enter into the contract. The contracts, describes the social behavior on how one party to the contract treats the other party to the contract.
13. Consent of parties
Torts: The consent of the parties are irrelevant in case of torts. They could happen with the consent or without the consent of the party.
Contracts: In contracts, the consent is a must. There should be meeting of minds (consensus ad idem) and agreements between the parties.
In tort, monetary compensation is awarded when there is damage in property, in case of any lack of medical care, the party has suffered pain. In contracts, monetary compensation can be availed in case of breach of contract. The court can order the performance of the contract or the recession of the contract.
In few instances, the same case may give rise to the liability to both tort and contracts.
Example:
If the person keeps their things in a locker in the railway station. Here, if the documents are missing from the locker they both are considered to be a tort as tort as the contract. the railway department is having a due duty of care and there is a implied breach of a contract.
How a Tort and a Contract is Similar?
Similarly like the differentiation, there are also few commonality between the tort and the contract. Both have few areas of common interest among them:
i. They both are considered to be a civil wrong.
ii. The plaintiff is having the responsibility to prove the cases of the probabilities. The burden of proof lies with the claimant (Actoriincumbit probation).
iii. The damages caused by the defendant is measured through the remoteness of the tort or breach of a contract. In accordance to the loss caused either commission of a tort or a breach of a contract compensation is awarded to the claimant.
Along with the breach of a contract even the foresee ability of a contract is also important.
Example:
In a case,[8] the plaintiff should be in the position to anticipate the future and know all the possibilities. The victims can claim compensation through the enforcement of law in case of tort and in contracts thee parties can decide the remedy they wanted:
i. The predominant aim of these both always try to compensate the affected party rather than punishing the wrongdoer.
ii. In case of breach of a contract, both the law of tort as well as the contract law provides remedy for the damage caused.
iii. Chiefly speaking both are civil rules and they also share ‘negligence’ as a common factor. Negligence can be a vital factor for the both. Each of them have their own legal duties. In torts people should have a due caution throughout the society and in contracts, they should have a due caution to perform their agreements without any breach. In case of contract, the aggrieved party need to prove before the court that the other party can caused the breach of contract, the other party have caused a harm to them.
If in case there is damage in the product delivered by the other party, or if it is defective, the manufacturers, suppliers, are liable to pay damages.
In all cases, either there is a breach or there can be a negligence or a strict liability.
Conclusion
To conclude with, despite tort and a breach of contracts are two different terms but in the eyes of law both are considered as a civil wrong. And law provides remedy for both the civil wrongs. Both the torts and contracts are essentials in our lives. We should know both these terms and use them accordingly. The court helps the affected party to seek the redressal and they help them to avail the compensation from the other party. And in breach of a contract, the parties decide the remedy. Tort and contract are important aspects. Tort and contract both are interconnected topics, but they are different branches of law. In my opinion, nowadays public has gained confidence on the courts. And more tort and contracts cases are registered in the courts and the claimant most probably seeks the remedy. The court has the legal obligation to conduct the cases and propose the judgement according to justice, equity and fairness. The key aspect of this article is to differentiate the difference between the two. And various factors such as the consent, nature, meaning, Limitation period etc. differentiate them and they also have some common factors with them. Both have their own ingredients and damages. They both have their own significance and their own principles.
Bibliography:
[1] Salmond’s definition of tort
[2]Ratanlal defines tort
[3] Winfield and jolowicz
[4] Barnett v Chelsea and Kensington HMC (1969).
[5] M.C Mehta v.Union of India.
[6] Jay Laxmi Salt Works (p) ltd v. state of Gujarat.
[7] Merriam Webster Dictionary
[8]Jolley v Sutton
[9] https://www.tutorialspoint.com/compare-between-tort-and-contract
[10] https://www.legalkatta.in/2021/12/difference-between-tort-and-contract.html
[11] https://www.accaglobal.com/my/en/student/exam-support-resources/fundamentals-exams-study-resources/f4/technical-articles/key-aspects-of-the-law-of-contract-and-the-tort-of-negligence.html
[12] Subha Rao book.
This article has been written by Sandhya Raga V, 2nd Year BA.LL.B(Hons.) Student at Sastra University.
