Theoretical overview
The parties to a contract must be competent to enter into a contract under Section 10. Section 11 of the ICA states that every person is competent to contract if he is a major of sound mind and must not be disqualified by any law to which he is subject.
Generally, the age of majority is 18. However, if the court appoints a guardian for the minor before he turns 18, then age of majority is 21. The day on which the person was born is to be included as a whole day, person becomes a major at the beginning of the day.
Contracts of Apprenticeship
Contract of apprenticeship are considered to be beneficial to the minor. The object of contracts of apprenticeship is to enable children, specially orphans to learn trades, craft, and employment by which they can earn livelihood after attaining majority. Section 9 of the Indian Apprentices Act requires guardian to make a contract on behalf of the minor.
Relevant sections
Section 10 The parties to a contract must be competent to enter into a contract.
Section 11 of the ICA states that every person is competent to contract if he is
- a major
- of sound mind
- not disqualified by any law to which he is subject
Section 68 of the Indian Contract Act states that if a person legally incompetent to contract is supplied with necessaries by another person, the person who supplies such necessaries is entitled to be reimburse from the estate of the minor.
Section 9 of the Indian Apprentices Act requires guardian to make a contract on behalf of the minor.
Important case laws
Case Law- Dane v. Viscountess Kirkwall (1838) 8 Car & P 679: 173 ER 670. – In this case it was held that it was not only required that the person was of unsound mind, but that the other party took advantage of that fact.Under English Law, a contract with a person who is of unsound mind is voidable at his option and he can also choose to affirm or avoid the contract. Under Indian Law, void. [English Law – Contract is binding on the unsound person as if he had been sane while making it, unless he can prove that the other party knew him to be of unsound mind. India – Same status as a contract with a minor, void. This is because person of unsound mind would not have been capable of understanding it and forming a rational judgement. He may however make a contract when he is of sound mind; Section 12 illustration shows an intoxicated person to be on the same footing as one of unsound mind]
Srikakulam Subramanyam v. Kurra Subba Rao (1948) 50 BOMLR 646 – The mother was the legal guardian and had the capacity to enter into contractual obligations. The contract being for the benefit of the minor and within the power of the guardian was held to be binding upon him
Chapple v. Cooper (1844) 153 ER 105 – Necessaries are those without which an individual cannot reasonably exist. They may include food, lodging, clothing etc. Necessaries may also include instructions in art, trade or intellectual, moral and religious education.
Raghava Chariar v. Srinivasa (36 Ind Cas 921, (1916) 31 MLJ 575) – A mortgage contract where the minor had advanced the amount is enforceable by or on behalf of the minor. Nothing in the contract act prevents the minor from being a promisee. A minor is allowed to enforce a contract which is of some benefit to him and under which he is required to bear no obligation
Mohori Bibee v. Dhurmodas Ghose (1903) 30 I.A. 114 65 – A false representation made to a person who knows it is false, is not such a fraud as to take away the privilege of infancy. Same principle is applied in Section 19 of the Indian Contract Act.Fraud / misrepresentation that was not the cause of consent to the contract with whom such a fraud or misrepresentation is done does not render a contract voidable.The moneylender would not get anything back as he was aware of the minority.
Khan Gul v. Lakha Singh, AIR 1928 Lah 609 – : CJ found sufficient reason for the extension of the rule from property to money and stated that there was no real difference between restoring the property and refunding the money, except that the property can be identified but cash cannot be traced. The doctrine of restitution rests upon the principle that an infant cannot be allowed by a court of equity to take advantage of his fraud. Accordingly, refund was ordered. (Not followed by next case, but then made into statutory law by Law commission – specific relief act 1963. Section 33 of SRA –
(a) where a void or voidable contract has been cancelled at the instance of a party thereto, the court may require him to restore such benefits as he has received under the contract and to make any compensation to the other party which justice may require;
(b) Where a defendant successfully resists any suit on the ground that the contract, by reason of his being incompetent, is void against him, he may be required to restore the benefits, if any, obtained by him under the contract, but only to the extent to which he or his estate has benefitted thereby).
Leslie Ltd. v. Sheill (1914) 8 K B 607 – If an infant obtains property or goods by misrepresenting his age, he can be compelled to restore it, but only so long as the same is traceable in his possession – Doctrine of restitution. This case held that it is not applicable where the infant has obtained cash instead of goods or property.
Burnard v. Haggis (1863) 14 C.B 45). – If the tort is directly connected with the contract and is the means of effecting it and is a parcel of the same transaction, the minor is not liable in tort. [Rule in Harimohan v. Dulu Miya, this case added onto it]. But where the tort is independent of the contract, the mere fact that a contact is also involved will not absolve the infant from liability. Minor was held liable.
Points to remember
- Minority: Generally, the age of majority is 18. However, if the court appoints a guardian for the minor before he turns 18, then age of majority is 21. The day on which the person was born is to be included as a whole day, person becomes a major at the beginning of the day
- Estoppel is a judicial device in common law legal systems whereby a court may prevent, or “estop”, a person from making assertions or from going back on his word. The Law of Estoppel cannot be invoked by a party to validate a contract which is void under the law. As Section 10 and 11 of ICA clearly bar a minor from entering in a contract, estoppel cannot be used to enforce the void contract.
- There is nothing in the ICA which prevents a minor from being a beneficiary or a promisee. He or she can accept benefits out of a contract. All such contracts are enforceable only when minor has already given the full consideration and only thing that is left is for him to receive the benefit.
- Contract of apprenticeship are considered to be beneficial to the minor. The object of contracts of apprenticeship is to enable children, specially orphans to learn trades, craft, and employment by which they can earn livelihood after attaining majority
- A minor cannot after attaining majority, ratify an agreement. Ratification dates back to the day of making the contract and since, the contract was void when it was formed it cannot be given validity later. A fresh contract with a fresh consideration has to be made by and with the minor after the minor attains majority
