Classification of Contract

Classification of Contract
Classification of Contract

Contracts can be classified into four broad divisions namely –

  1. The method of formation
  2. The time of performance
  3. The method of formalities
  4. The method of legality

1. The method of formation:

Under the method of formation of a contract may be three kinds –

  1. Express contract
  2. Implied contract

a. Express contract:

Express contract is one which expressed in words spoken or written. When such a contract is formal, there is no difficulty in understanding the rights and obligations of the parties.

b. Implied contract:

The condition of an implied contract is to be understood form the acts, the contract of the parties or the course of dealing between them.

2.The time of performance:

Under the method of the time of performance of contract may be two kinds

  1. Executed Contract
  2. Executory Contract

a. Executed Contract:

There are contracts where the parties perform their obligations immediately, as soon as the contract is formed.

b. Executory Contract:

In this contract the obligations of the parties are to be performed at a later time.

3. The method of formalities:

Under the method of the method of formalities of the contract   may be two kinds-

  1. Formal contract
  2. Informal contract  

a. Formal contract:

A formal contract is a contract which is formatted by satisfied all the essentials formalities of a contract. 

b. Informal contract:

An informal contract is a contract which is failed to satisfy all or any of the essentials formalities of a contract.

4.The method of legality:

Under the method of the method of legality of the contract may be five kinds

  1. Valid Contract
  2. Void Agreement
  3. Void able Contract
  4. Unenforceable Agreement
  5. Illegal Agreement

a. Valid Contract:

An agreement which satisfied all the essential of a contract and which is enforceable through the court is called valid contract.

b. Void Agreement:

An agreement which is failed to satisfied all or any of the essential element of a contract and which is not enforceable by the court is called void agreement. An agreement not enforceable by law is said to be void. A void agreement has no legal fact. It confers no right on any person and created no obligation. 

Example: An agreement made by a minor.

c. Void able Contract:

An agreement which is enforceable by law at the opinion of one or more parties of the contract but not at the opinion of the other or others, is a void able contract.

A void able contract is one which can be avoided and satisfied by some of the parties to it. Until it is avoided, it is a good contract.

Example: contracts brought about by coercion or undue influence or misrepresentation or fraud. 

d. Unenforceable Agreement:

An Unenforceable Agreement is one which cannot be enforcing in a court for its technical and formal defect.


  • An agreement required by law to register but not registeted.
  •  An agreement with not satisfied stamped.

e. Illegal Agreement:

An illegal agreement is one which is against a law enforcing in Bangladesh.

Example: An agreement to compiled murder.

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