The Indian Contract Act, 1872, is the primary legal framework governing contractual relationships in India. It provides the legal foundation for the formation, execution, and enforcement of agreements between two or more parties. The Act ensures that all agreements, whether oral or written, meet essential criteria such as offer, acceptance, lawful consideration, capacity of parties, and free consent to be considered legally binding. Therefore, the enforceability of fashion contracts depends on compliance with the legal principles outlined in the Act. Disputes often arise in supplier agreements and brand collaborations. Hence, there is a call for the need of precise contractual drafting, which must be prioritised.
The fashion business, consisting of innovators, intellectual property assets, and brand-driven collaborations, relies strongly on these clearly defined and enforceable contractual frameworks. These contracts govern interactions between: traders and designers, influencers and brands, models and employers, manufacturers and retailers. Although the niche of fashion law is in the early stages in the market, it is not foreign to the Indian jurisprudence. Ayushman Mishra [1]explains the extent to which the Indian fashion industry is presently regulated by a “network of legal domains,” with contract law at its core, in his paper. Mishra identifies the zones of intersection between the Indian Contract Act and labour law, competition law, and intellectual property law, thereby setting out its significance in adjudicating complaints about employment misclassification, licensing violation, and unfair trade practices. Mishra confirms that “Contract law plays a key role in maintaining balance and accountability in the fashion system, especially as the industry continues to globalise and digitise.
Relevance In The Fashion Industry
- Brand Partner and Design Licensing: The arrangement of design contracts is essential for ensuring that designers and commercial enterprises can collaborate securely and profitably in contexts where the designs of these enterprises pertain to brand partnerships and design licensing. Such contracts delineate the terms and conditions related to revenue sharing, creative control, and exclusivity, thereby balancing commercial interests with artistic integrity. The Act is responsible for enforcing these contracts, provided that adequate consideration and consent are obtained.
- Model and Influencer Contracts:
In light of the rise of online marketing, influencer contracts have emerged as a predominant element in fashion advertising. These contracts typically incorporate morality clauses, performance clauses, and exclusivity clauses. As stipulated by the Act, it is imperative that all such clauses adhere to a legal format to mitigate the risk of being deemed voidable or subject to misinterpretation.
- Independent Contractor and Employment Agreements: Mishra highlights that the misclassification of labour constitutes one of the most significant challenges within the Indian fashion industry. A substantial number of workers are engaged as independent contractors, yet they are often deprived of minimum statutory protections. The Act functions as a key instrument for safeguarding their rights through legally enforceable contracts, which are necessitated by complex structuring and compliance with Indian law.
- Settlement of Disputes and Remedy of Breach:
There are usually controversies arising out of the infringement of designs, delays in delivery, and payment delays. The Act, with its provisions relating to liquidated damages (Section 74) and compensation (Section 73), gives a legal framework for the compensation of claims. Such clauses deter unfair practices and also uphold justice in contractual relations.
The Role Of Contractual Agreements In Governing Business Interactions Within The Fashion Sector:
Today, contractual agreements are the fundamental component in almost all business and commercial relationships. From design collaborations, manufacturing deals, to influencer endorsements and digital licensing, Contracts offer a legal framework that outlines the rights, responsibilities and expectations of the parties involved. These agreements play a crucial role in safeguarding income and intellectual property while ensuring general transparency and responsibility in highly competitive and frequently fast-paced fashion sectors.
Such contracts are legally binding and, therefore, must account for any violation, delay, or non-compliance so as to reduce litigation potential and ease doing business. In a world in which exclusivity, supply schedules, and brand image matter to every stakeholder, ultimate benchmarks of performance and methods of dispute resolution may be defined by contracts.
In “Synthesis of Fashion and Law: An Interdisciplinary Perspective,” Siddhi P. Joshi[2] stresses the significance of interdisciplinary legal resources, particularly the law of contracts, in managing moral and commercial transactions in fashion. Joshi asserts that since contracts are an interweaving factor between the regulation of the economy and freedom for creativity, contracts promote creative behaviour that can legally be safeguarded. Joshi notes: “Fashion law must move beyond mere IP protection and embrace the nuanced role of contracts in shaping equitable and enforceable relationships in a fragmented industry.”
Thus, from protecting a designer’s signature style or setting the deliverables for a garment manufacturer, contractual agreements are an indispensable tool in regulating India’s evolving fashion industry.
[1] Ayushman Mishra. ‘Exploring Fashion Law and Its Potential in India’. IJLLR Journal, vol. Volume VI, no. Issue VI, Jan 13, https://www.ijllr.com/post/exploring-fashion-law-and-its-potential-in-india?
[2]Siddhi P Joshi. ‘SYNTHESIS OF FASHION AND LAW: AN INTERDISCIPLINARY PERSPECTIVE’. INTERNATIONAL JOURNAL OF ADVANCED LEGAL RESEARCH, vol. VOLUME 3, no. ISSUE 4, May 2023, https://ijalr.in/wp-content/uploads/2023/06/Siddhi-P.-Joshi-Synthesis-of-Fashion-and-Law-An-Interdisciplinary-Perspective.pdf.