Quran Quote on Contracts - Contract Laws in Pakistan
Surah Al Baqarah Chapter 2 Verse 282 – “O believers! When you contract a loan for a fixed period of time, commit it to writing. Let the scribe maintain justice between the parties. The scribe should not refuse to write as Allah has taught them to write. They will write what the debtor dictates, bearing Allah in mind and not defrauding the debt. If the debtor is incompetent, weak, or unable to dictate, let their guardian dictate for them with justice. Call upon two of your men to witness. If two men cannot be found, then one man and two women of your choice will witness—so if one of the women forgets the other may remind her.1 The witnesses must not refuse when they are summoned. You must not be against writing ˹contracts˺ for a fixed period—whether the sum is small or great. This is more just for you in the sight of Allah, and more convenient to establish evidence and remove doubts. However, if you conduct an immediate transaction among yourselves, then there is no need for you to record it, but call upon witnesses when a deal is finalized. Let no harm come to the scribe or witnesses. If you do, then you have gravely exceeded your limits. Be mindful of Allah, for Allah ˹is the One Who˺ teaches you. And Allah has ˹perfect˺ knowledge of all things.”

Contract Lawyers in Pakistan

A Contract Lawyer in Pakistan is an attorney who specializes in contract drafting, contract formation, breach of contract, and resolving disputes stemming from contractual obligations. In Pakistan, the Contract Act 1872 covers the legalities of contracts.

As we have added at the beginning of this page, Mohammadan Law can also shed light on how Contracts should be both formed, and honored. In this article we will discuss the basics of contracts in Pakistan, and what you should consider before entering into a contract in Pakistan, and why you should consult with a Corporate Lawyer in Pakistan in such matters.

Contracts in Pakistan are agreements

Contracts in Pakistan are an essential component of business, whether in domestic trade, employment, within Pakistan, or for International business, i.e. with a business in Dubai, as a freelancer. They are legally binding agreements between two or more parties.

A Contract should outline the obligations of all parties involved, known as the terms and conditions. When done properly, contracts serve as a way to protect the rights and interests of all parties involved and can help resolve delays, mishaps, or disputes if things do not go according to plan.

10 Considerations for Contract Lawyers in Pakistan

Whilst there may be several factors to consider when entering a contract, Contract Lawyers in Pakistan recommend that the following 10 factors should be discussed and considered by all parties involved. They are in no particular order.

  1. Identify the Parties: All parties should be mentioned that are involved in the contract, by including their names (as mentioned on their CNIC or Passport), Fathers’ names, residential addresses, and any relevant contact information.
  2. Define the Obligations: Clearly define the terms and conditions of the agreement, including the scope of work, milestones, payment terms, and any other relevant details.
  3. Ensure timelines are stated: If there are deadlines then they should be mentioned, along with the notice period should there be any issues.
  4. Clarity: Use clear and easy-to-understand words. Avoid using vague or ambiguous terms and phrases that may lead to misunderstandings and/or disputes.
  5. Jurisdiction: Ensure that the contract complies with all applicable laws and regulations of Pakistan, including local, civil, criminal, and federal laws.
  6. Penalty Clauses: If one party may suffer due to a breach of contract, then pre-determining punitive and remedial action ensures that both parties are aware of the consequences beforehand.
  7. Resolving Disputes: It is good practice to add provisions for resolving disputes, including mediation or arbitration.
  8. Termination Clauses: Include termination clauses that state the circumstances under which the contract can be terminated.
  9. Relevant Clauses: Where necessary, Include clauses that protect confidential information and trade secrets.
  10. Witnesses: It is good practice to ensure that at least 2 witnesses are present when the contract is being discussed, agreed upon, and signed.
Circumstances for Amending Contracts in Pakistan

A contract may be amended under certain circumstances. The process for amending contracts in Pakistan will depend on the terms and conditions outlined in the contract itself.

For example, a contract may include a provision that allows for amendments to be made with the mutual consent of all parties involved. Circumstantial changes could also lead to understandable and forced modifications to the contract.

Circumstances for Terminating Contracts in Pakistan

A contract can be terminated by mutual consent, non-performance, or breach of contract. For example, if a service provider fails to deliver the services as agreed, the other party may have the right to terminate the contract.

Circumstances can also render a contract null and void; Contracts that were entered into via fraud can also be voided. Contracts, where one party passes away, are automatically terminated.

Remedies in the Event of a Breach of Contract

When a party breaches a contract, the non-breaching party may be entitled to remedies such as damages or specific performance. The type of remedy will depend on the terms and conditions outlined in the contract itself.

  • Damages: The most common remedy in the event of a breach of contract is a penalty in the form of compensatory damages. Damages are a monetary amount that is awarded to the non-breaching party to compensate for any losses incurred as a result of the breach of contract.
  • Specific Performance: In some cases, a court may order specific performance as a remedy for a breach of contract. This means that the breaching party will be required to fulfill their obligations under the contract as outlined in the agreement. Specific performance is usually awarded when monetary damages are not sufficient to compensate for the losses incurred.

Get our Contract Lawyers in Pakistan to draft your agreement

Whether it’s a simple or complex contract, it is always advisable and beneficial to get a Professional Contract Lawyer in Pakistan involved. They have the experience and expertise to ensure that the contract is legally binding, enforceable, and able to protect the rights and interests of our clients involved.

A well-drafted contract can help to prevent disputes and minimize the risks associated with doing business in Pakistan. We can also help to ensure that the contract complies with all relevant laws and regulations.

Our panel of skilled Business and Corporate Lawyers in Pakistan specialize in Contract law and offer personalized advice and robust legal solutions.

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