1. Mr. A the agent contracts with Mr. B to sell his house and he also contracts with a buyer Mr. C to purchase a house for him. Mr. B and Mr. C agree to sell and purchase house for RS. 50, 00,000. In the above transaction there are multiple contracts. Mr. A is acting as the agent for both Mr. B and Mr. C. Mr. A has his one agreement with Mr. B that he will sell his house. Then Mr. A has his contract with Mr. B to purchase a house for him. The third agreement in this transaction is between Mr. B and Mr. C for the sale and purchase of House for RS. 50, 00,000.
Example No. 2:
2. Mr. A contracts with Mr. B to purchase 1000 kg flour for RS. 25000 and Mr. C provides the surety to Mr. B that in case of Mr. A’s default he will pay the amount of RS. 25000. This is the contract of Guarantee. This transaction contains three contracts. The first contract is between Mr. A and Mr. B for the purchase and sale of 1000 kg of flour. The second contract is between Mr. C and Mr. B in which C is giving surety to B that if A defaults he will pay the amount of RS. 25000. The third contract is of Indemnity between Mr. A and Mr. C in which Mr. A will compensate to C the entire amount paid by C because of his default.