The agreements, the meaning of which is not certain or capable of being made certain, are void.

 As certainty of terms of agreement is also an essential ingredient of the agreement, hence those agreements which are uncertain are void. In simple terms, the terms of agreement should be clear, and unambiguous. In this regard, section 29 says that-

Agreements Void for Uncertainty:

Agreements, the meaning of which is not certain, or capable of being made certain, are void.

Illustrations:

(a) A agrees to sell to B “a hundred tons of oil”. There is nothing whatever to show what kind of oil was intended. The agreement is void for uncertainty.

(b) A agrees to sell to B one hundred tons of oil of a specified’ description, known as an article of commerce. There is no uncertainty here to make the agreement void.

(c) A, who is a dealer in cocoanut-oil only, agrees to sell to B “one hundred tons of oil”. The nature of A’s trade affords an indication of the meaning of the words, and A has entered into a contract for the sale of one hundred tons of coconut oil.

(d) A agrees to sell to B “all the grain in my granary at Ramnagar”. There is no uncertainty here to make the agreement void.

(e) A agrees to sell B “one thousand maunds of rice at a price to be fixed by C”. As the price is capable of being made certain, there is no uncertainty here to make the agreement void.

(f) A agrees to sell to B “my white horse for rupees five hundred or rupees one thousand”. There is nothing to show which of the two prices was to be given. The agreement is void.

The text and (with one addition) the illustrations of this section follow the draft of the Indian Law Commissioners with only formal variation.

Where the defendants, describing themselves as residents of a certain place, executed a bond and hypothecated as security for the amount “our property, with all the rights and interest”, it was held that the hypothecation was too indefinite to be acted upon.

The mere fact that the defendants describe themselves in the bond as residents of a certain place is not enough to indicate their property in that place as the property hypothecated. If they had described themselves as the owners of certain property it would then have been reasonable to refer the indefinite expression to the description.

In Ramasami v. Rajagopala, (1887) 11 Mad. 200 the Court held that a stipulation in a patta (lease) whereby the tenant agreed to pay whatever rent the landlord might fix for any land not assessed which the tenant might take up (presumably without permission) is void for uncertainty. Under such a patta, the landlord might fix any rent he liked, and the tenant might be liable for an unreasonable rent beyond the value of the land.

Under Section 29 of the Indian Contract Act, an agreement would be deemed to be void only when its terms are vague and uncertain. The general rule is that if the terms of an agreement are so vague or indefinite and that it cannot be ascertained with reasonable certainty regarding the intention of the parties, then the said contract becomes unenforceable in law.

But, a contract will not become void, if its terms are capable of being ascertainable with precision and the intentions of the parties to the contract could be ascertained. Ultimately, the object of the court is to do justice between the parties and the court will do its best if satisfied that there was ascertainable and determinate intention to contract, to give effect to that intention looking at substance and not mere form.

Therefore, the requirement that an agreement in order to be binding, must be sufficiently definite to enable the court to give it a practical meaning.

In Uttam Singh Dugal & Co. Pvt. Ltd. v. Hindustan Steel Ltd., Bhilai, AIR 1982 MP 206 the Division Bench of Madhya Pradesh High Court observed that solemn contracts entered into between the parties are not to be readily declared invalid for uncertainty as to certain terms, at any rate in those cases where the parties have acted upon the contracts which have been fully executed.

While construing a contract the object of the court is to do justice between the parties and the court will do its best if satisfied that there was an ascertainable and determinate intention to contract to give effect to the intention, looking at substance and not mere form. It will not be mere difficulties of interpretation difficulty is not synonymous with ambiguity so long as any definite meaning can be extracted.

Madras High Court in M.Ramasamy v. K.K.Ponnusamy, on 23 November, 2010 observed that under Section 29 of the Indian Contract Act, an agreement would be deemed to be void only when its terms are vague and uncertain.

The general rule is that if the terms of an agreement are so vague or indefinite and that it cannot be ascertained with reasonable certainty regarding the intention of the parties, then the said contract becomes unenforceable in law. But, a contract will not become void, if its terms are capable of being ascertainable with precision and the intentions of the parties to the contract could be ascertained.

Ultimately, the object of the court is to do justice between the parties and the court will do its best if satisfied that there was ascertainable and determinate intention to contract, to give effect to that intention looking at substance and not mere form.