Professional Documents
Culture Documents
i) Who is major.
ii) Who is of sound mind.
It is evident that minors and unsound mind person
cannot make a contract. A Major person means who has
attained the age of 18 years. The age of majority has
been decided by Indian majority act 1875. In case of
guardian appointed by the court, the age shall be 21
years.
An agreement made by a minor is void., from
the above statement we find that the minor is not
competent to contract. Indian contract act is silent about
whether it will be void or voidable up to 1903. But it is
decided by the Court that these are void. Agreement by a
minor is void-ab-initio, such contract cannot be enforced
by law. Further the minor cannot authorise any other
person to do a contract.
Case Mohiri Bibi vs Dharamdass Ghosh (1903) A minor
Mr. Dharamdass Ghosh executed a mortgage documents
for Rs.20,000.00 in favour of a money lender Sh. Brahmo
Dutt. The money lender actually paid Rs.8,000.00 to the
minor. It is important that before this transaction the
guardian of the minor informed the Attorney of Money
lender that he (Dharamdass Ghosh) is minor. Later on a
suit was instituted by the minor Dharmadass Ghosh
against the money lender Sh. Brahamo dutt with the
intention that the mortgage be set aside. This suit was
opposed by Money lender by saying that the above
contract being voidable, he has the right to receive the
amount of the loan under section 64 and 65 of Contract
Act i.e. minor is bound to return back the amount.
Privy council held that, the contract is void abinitio which cannot be enforced. It was also held that the
minor could not be asked to repay the loan taken by him.
It was further held that law of estoppels cannot be applied
against the minor Shri Dharmodas Ghosh being misstated falsely his age because he was minor at the time of
the agreement and the agreement was void. The law of
estoppels as stand in section 115 of Indian Evidence Act
was not applicable to the present case as the plaintiff was
minor at the time of making agreement, this fact was also
known to the agent of Brahmo Dutt defendant. Under
Specific Relief Act 1877 Section 38 and 41 applies where
party had the knowledge of minority age gets restitute
degree.
A new concept of beneficial has come into
existence now. It has been held in various cases. A minor
is bound for the beneficial contract. The beneficial
contract are those contracts which are for the benefit of
minor. The first case was S.Subramanyam v/s Subha
Roy-1948 - In this case transfer of inherited property of
a minor affected by his guardian to pay off an in-herited
debt was binding on him for his benefit. Here is a list of
beneficial contract
i) Contract of Insurance Such contracts are in the benefit
of minors.
ii) Contract to purchase the immoveable property Such
contract are valid.
iii) Contract of service - These are for the benefit for the
monors
iv) Contract of apprentice ship Training period of any
minor who is taking training from any person, because of
All illegal agreements are void but all void agreement are
not illegal. Comments
Ans- INTRODUCTION Under section 2(g) of Indian
Contract Act 1872, definition of void agreement has been
given and according to it , Agreement in not only
enforceable by law said to be void. For instance, an
agreement by a minor has been held to be void. Section
24 to 30 of the Indian Contract Act 1872, make a specific
mention of agreement which are void. Generally the
following agreements are not enforceable by law.
i) Whose parties are not competent to do a contract i.e.
they are not adult and are unsound mind.
ii) Whose parties do not have free consent i.e. they are
under coercion, undue influence fraud & misappropriation
etc.
iii) Whose consideration and object has not been lawful
iv) Which are immoral or against public policies.
v) Which do not create valid (illegal) liabilities between the
parties.
vi) Which have been declared as void by the court etc.
All above agreements are void because they cannot be
enforced by law.
ILLEGAL- AGREEMENTS
Illegal agreements are such agreements whose
consideration and object are not lawful i.e. they are illegal.
Such agreements are mentioned in section 23 of the
Indian Contract Act 1872. The following agreements are
considered as illegal1. Which are prohibited by Law.
2. Which is of such a nature if followed would defeat the
provisions of law.
3. Which is fraudulent.
4. Which is causing injury to body or property of any other
person.
5. Which have been declared by the court as immoral or
against public policies.
After the definition of void and illegal
agreements we have considered the following statements
That all illegal agreements are void agreements but all
void agreements need not necessarily be illegal. It can be
adjudged from the following i) Illegal agreements are void ab-initio which cannot be
enforced by law at any time whereas void agreement need
not be void-ab-initio, such agreements could become unenforceable by law later.
ILLUSTRATION An agreement takes place between the
citizen of India and Pakistan which was enforceable by law
at the time agreement, but later on in the event of war
between India & Pakistan the agreement becomes unenforceable whereas agreement to pay money by A to B
for illegal intercourse is void ab-initio which cannot be
enforced any time. This shows the illegal agreements are
always void whereas void agreements are not always
illegal.
ii) Parties of illegal agreements can be punished whereas
the parties of void agreements cannot be punished.
ILLUSTRATION - An agreement to encourage any woman
for prostitution by paying her money is punishable but an
agreement by minor or without consideration is not
punishable. This also proves the fact that every illegal
agreement is void but every void agreement is not illegal
UNIT III
Question No. 5. Discuss contingent contract. Elaborate
with suitable illustrations. How are such contract is
different from Agreements?
Answer :- INTRODUCTION : Contingent contract is
special types of contract. Generally in most contracts
rights of parties are enforced immediately after the
execution of contract, but sometimes there are contracts
whose enforcement depends upon happening or nonhappening of an event.
DEFINITION :Section 31 of Indian Contract Act 1872 defines that
Contingent Contract according to it : A contingent contract
is a contract to do or not to do something, if some event,
collateral to such contract does or does not happen.
ILLUSTRATION : A contracts with B that if the house of B destroyed by
fire then he shall pay Rs.10,000/- to B. It is contingent
contract because the enforcement of contract depends on
the happening or non happening of an event.
Thus the contingent contract depends upon the
happening of a uncertain event. If the event is of certain
nature, then it shall not be contingent contract.
ELEMENTS OF CONTINGENT CONTRACT
These are as under:1. The contingent contract depends upon the happening or
non-happening of an event.
Question No.6 : Define Fruad? Distinguish between Fraud
and Misrepresentation. Whether silence amounts to fraud?
OR
2. What are the factors which vitiate consent and make
the Agreement
Void or voidable?
OR
3. What is consent? When is consent said to be free under
Indian Contract Act?
OR
Distinguish between coercion and undue influence.
Answer : INTRODUCTION :An agreement becomes contract if it fulfils the conditions
of /section 10. According to sec. 10 for an agreement
becomes contract with law full object and consideration. It
means free consent is not free then the contract is invalid.
But it is voidable not void. Voidable means a contract
which can be declared void by the court at the option of
other party.
under sec.2(1). Section 198, 10(a) also deines the term
voidable.
Section 13 : Consent : According to Indian Contract Act
1872:- Two or more persons are said to consent when
they agree upon something in the same sense.
In the above definition it shows that (i) At least two
persons are must (ii) for the same thing and same sense.
Land & House Property Corp.: A sold a hotel and said that
all rent holders are gentleman. Actually they it all were
defaulters. It held misrepresentation. Case : Derry v/s
Peek(1889) it was held that the management of the
company was guilty of misrepresentation, and not for
fraud. Another Case : Noor-ud-din v/s Umerao Bibi 1998: A
sale deed was challenged on this ground that it was
executed under fraud and misrepresentation seller was a
blind person. He was also not paid sufficient consideration.
The possession of property was also transferred to the
buyer, court declared such sale deed to be set-aside.
DIFFERENCE
BETWEEN
FRAUD
&
MISREPRESENTATION
FRAUD
MISREPRESENTATION
1. Fraud contains the intention
It does not contain any
such intention.
To deceive.
2. The facts are altered with the
No such thing in
misrepresentation. Any
Intention to deceive the other
is presented as such
presented as such
Person.
Whereas it does not
came out to be true
3. The guilty person has the
The guilty person has
no knowledge of
Knowledge of truth.
Truth.
4. Fraud is a type of tort and
It does not come under
tort.
So punishable.
Case : Gujrat Bottling Co. Ltd. v/s Coca Cola Co. 1995: It
was held that provisions related o agreement in restraint of
trade shall not apply in such matters in which are
prohibited only for the time of existence of contract. If they
are applied even after the termination of contract, then i
shall be void.
2. Partnership Agreements : Where there is an agreement
between partners at the time of formation of firm that any
partners shall not carry a similar or otherwise any trade
during the existence of partnership, then such an
agreement is not considered to be creating restraint.
3. Dissolution of Partnership :- If any agreement is made
between the partners at the time dissolution of partnership
or a partner shall not carry a business similar to that of
firm for a specific time, then such agreement shall not be
void provided that it is reasonable.
Question No.8 : What do you understand by Quasicontract? State its essential features. OR
Quasi-Contract are in law but not in fact. Explain. OR
Quasi- contract is not the product of an agreement entered
into parties but a creation of law on the basis of equitable
principles. Discuss the above statement and state the
quasi contract relations recognised by the India in
Contract Act.? OR
What do you understand by Quasi-contracts? Explain
some relations which are resembling to those created by
contracts as incorporated under the Indian Contract Act
1872.
UNIT-III
Question No.9:- Explain the term Anticipatory Breach of
Contract and discuss the consequences of such a
breach.
OR
Discuss the consequences of breach of contract with
relevant case.
OR
Who must perform the Contract? Who can demand for the
performance of Contract?
Answer: INTRODUCTION ; Contracts are important when
they are performed. There are two main questions in this
respect :i) Who shall perform the contract,
ii) Who can enforce the performance of the contract.
i) Who shall Perform a Contract :- Section 40 of the Act
mentions that generally the contract shall be performed by
the promisor itself if the parties has such intentions.
Otherwise the promisor can employ any other person for
the performance of contract.