Contract act

  Chapter 2

Contracts , voidable contracts and void agreements 

Section 10.

What agreement are contracts---- 

All agreements are contracts 

If they are made by the free consent of parties 

Competent to contract 

For a lawful consideration and with a lawful object 

And are not hereby expressly declared to be void 

Nothing herein contained shall effect any law in force in India 

And not hereby expressly repealed 

By which any contract is required to be made in writing 

Or in the presence of witness or any law relating to the registration of documents.

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If any minor enters into a contract .it will void or voidable .this discrimination had been decided in 

Mohari Bivi versus Dharamdas ghosh 

After decision of this case it has been decided that contract with a minor is absolutely void 

Facts of this case ----

Plaintiff was a minor he had wanted to mortgage his house and take loan of 20,000/.he had entered into a contract and taken 8000/ immediately .after that lawyer of respondent came to know that plaintiff was a minor .

Minor plaintiff had filed a suit to cancel this mortgage on behalf of his minorship .

Now the question arise that minor will have to return that got benefit 

Respondent had wanted his money on section 64 of ICA .but this section is not applicable here .but to apply sec.64 contract must be voidable but here contract is void.

Respondent had argued again that he had got his given amount under section 65 of ICA .but to get such money party must be competent under any contract.but in above situation there was not any contract so this section is not applicable.

Land mark judgement no.2

Leslee (R) ltd.versus sheel

 Doctrine of restitution had been given in this case .

A minor had  borrowed 400 pond having lied about his age .the mortgagor had wanted their principal amount with interest .

Decision ---the court had decided that he will not give any money if he had spent that money . If the goods or money  in his possession ,in Such condition  such things  can be taken.this principal is known as doctrine of restitution.in this condition contract was not quasi and implied .

Important point 

If tort is not part of contract then  minor  will be liable or tort is not part of any contract then a minor is not liable .

Related case 

Bernad versus Haygis 

facts-----a minor had taken a mare to ride .he had given this mare to his friend who used this mare for jumping .owing to this reason the mare had died .in this case minor was responsible for this tort

Jingis versus Randaal

Respondent was minor he had hired a horse to go for a distance .but he had taken that horse for a long ride .in this case minor was not held liable for tort .this was breach of contract or nothing .so he was not held liable in this case

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Section 11

Who are competent to contract 

Every person is competent to contract who is of the the age of majority according to the law to which he is subject and 

Who is of sound mind and 

Is not disqualified from contracting by any law to which he is subject.

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Section 12

What is a sound mind for the purpose of contracting 

A person is said to be sound mind for the purpose of making a contract 

If at the time when he makes it and of forming a rational judgement as to its effect upon his interests.

A person who is usually of unsound mind 

But occasionally of sound mind ,may make a contract when he is of sound mind 

A person who usually of sound mind but occasionally of unsound mind 

May not make a contract when he is of unsound mind 

Landmark decision 

Inder singh versus Parameshwaridhari  singh 

A boy had sold his property  at 7000/  which actual price was 25,000/ .the motherbof seller had given proof of this thing that his son was inborn idiot .he did not understand result of any contract .

Decision ----this contract was absolutely void .this is not essential that pers

Illustrations 

A.a patient is a lunatic asylum who is at intervals of sound mind may contact during those intervals.

B.A sane man who is delirious from fever or who is so drunk that he cannot understand the terms of a  contract or form a rational judgement as to its effect on his interest cannot contract whilst such delirium or drunkeness last .

Related case 

Nilima Ghosh versus Harjeet kaur 

The parties must be sound mind at the time of contract .unsound mind cannot enter into a  contract .unsoundmindness must be exisist at the time of contract and medical certificate must be presented  at that time .

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Section 13

Consent defined 

Two or more persons are said to consent when they agree upon the same thing in the same sense.

Smith versus Huge 

According lord heynon 

Both parties must be in the same sense over it matter of object .

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Section 14.

Free consent defined--

Consent is said to be free when it is not caused by --

1.coercion as defined in section 15 or

2.undue influence as defined in section 16

3.fraud is defined in section 17 or 

4.misrepresentation as defined in section 18

5.mistake subject to provision of section 20,21 and 22 

Consent is said to be so caused it would not have been given but for the existence of such coercion ,undue influence,fraud , misrepresentation or mistake 

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Section 15

Coercion defined

Coercion is the committing or threatening to commit 

Any act forbidden by the Indian penal code(45 of 1860) or 

The unlawful detaining or threatening to detain any property 

To the prejudice of any person whatever with the intention of causing any person to enter into an agreement.

Explanation ---+it is immaterial wheather the Indian penal code is or is not in force in the place where the coercion is employed.

Two ingredients are included in this section 

1. To threat or have done  

any prohibited work by Indian penal code 

2.to detain property and to threat property illegally 

Illustrations 

A on board an English ship on the high seas causes B to enter into an agreement by an act amounting to criminal intimidation under Indian penal code 

A afterwards sues B for

breach of contract at Calcutta 

A has employed coercion 

Although his act is not an offence by the law of England and although section 506 of Indian penal code was not in force at the time when or place where the act was done .

Difference between english and Indian law

Which thing is known as coercion in India that is called duress or menace in english law .which means immediate violence and rock a comman man .

Landmark decision 

Chikam Amiraju versus chikaam sheshmaa 

A hindu person threatened his wife and son to sign documents to get property .that property had been left for his brother .this document  was voidable .because this act was come under the purview of section 15 indian Contract Act 

Detention of property ----plaintiff had pledged his plate for 20 pond .when he went to take his plate .then that person had demanded 10 pond as interest .he had paid and taken his plate again .after that he had filed a case to take his extra money .

Decision ----in this situation the act of respondent come under section 15 because of coercion .the respondent had tried to  restrain his property 

But threat of criminal case is not come under coercion. To threat a fabricated case comes under coercion.

Land mark case 

Askari mirza versus bibi jay kishori 

A minor had hidden his minorship and entered into contract .the another party threatened him to file a case .now he has become adult .he had entered into a new contract to avoid any legal proceeding .this does not come under coercion.

Another land mark case

In this case a woman 's husband died .her relatives had threatened him not to create her husband if she had not adopted a boy according their  desire .this act comes under defination of coercion under section 15 

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