Capacity of the Parties

Section 11 - Competent parties

1. Sound Mind
2. Major
3. Not Disqualified by Law:
a. Insolvency and bankruptcy
b. Convicted who is under-going sentence

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c. Alien enemy
d. Foreign Ambassador.

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Minor’s contract - In India, as per the Section 3 of the Indian Majority Act, 1875, the age of
majority is 18 years but if a guardian of a minor’s person or property is appointed then it is 21

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years. This was the case for a long time but later the Indian majority Act was amended and the
21 years clause was removed. Now the age of majority is 18 years whether or not a guardian has

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been appointed to the person or property.

# Mohri Bibi v. Dharmodas Ghose

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It was held that a contract with a minor is void-ab-initio, it was also held that ratification dates
back to the day on which the contract was created. In case of a minor ratification is not possible
because on the day of creation of the contract, the minor was not competent to enter into a
contract. tr-It5Kacts makes
2I1K6E 9I0I5D it essential that all contracting parties should be competent and a person
who by reason of infancy is incompetent to contract cannot make a contract within the meaning
of this act. The question whether a contract of minor is void or voidable pre supposes the
existence of a contract which cannot arise in case of an infant. Since such agreements are void-
ab-initio, they cannot be validated by subsequent ratification.
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# Leslie v. Sheil

Doctrine of traceability or “restitution stops when repayment begins” – it stated that only that
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amount is recoverable which can be traced back to the to whom it was given. The
moment it cannot be traced any further or where money has to be returned instead of the product
itself, it cannot be then returned. This doctrine was overruled in the upcoming cases and
enactments.

#Khan Gul v. Lakha Singh

 As per the Indian Law, if a Minor goes to the court as a plaintiff seeking relief as cancellation of
an instrument, the court may ask him to restore the benefits. “Equitable Jurisdiction” which was
initially developed on various principles of equity and its purpose was to provide fair and reasonable
remedies to people, keeping in mind the intention of both the parties. Because of which when it was settled
law that a minor’s agreement is void and principle of restitution cannot be applied in such circumstances the
court diverted from the view and held that when the minor deliberately misrepresents himself as “adult” and
enters a contract, the fair and reasonable action would be to exercise its equitable jurisdiction and apply the
principle of restitution.

Section 33 of the Specific Relief Act - Where a defendant successfully resists any suit on the ground
that the agreement sought to be enforced against him in the suit is void by reason of his not

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having been competent to contract under section 11 of the Indian Contract Act, 1872 (9 of 1872),
the court may, if the defendant has received any benefit under the agreement from the other

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or his estate has benefited thereby.

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party, require him to restore, so far as may be, such benefit to that party, to the extent to which he

# Sadiq Ali v. Jai Kishore

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There can be no estoppel against a minor. Where the general substantive principles under the

cannot over ride it.

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Indian Contract Act says that “a minor contract is void-ab-initio, the procedural rule of estoppel

Minors and Torts

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A minor will be liable for torts even if it arises because of a contract.

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# Bernard v. Haggis

In this case,5Kthe minor

tr- 2I1K6E9I
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and killed her, if an infant’s wrongful act though concerned with the subject matter of the
contract and such that, but for the contract there would have been no opportunity of committing
it, it is never the less independent of the contract and the minor is liable.

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Sound Mind

Section 12 provides for when a person would be construed as a person

tr-5M2R1U6Q
9U0P5Qof sound mind. A person
would be said to be a person of sound mind if at the time of making of contract:
a. He is capable of understanding it (i.e., nature of contract); and
b. Is capable of forming a rational judgment as to its effect upon its interest.

# Chako v. Mahadevan
 The illustration B appended to section 12 shows that a drunken person is in the same category as
of unsound mind. A sale deed of a property executed at the time when the plaintiff was suffering
from Alcoholic Psychosis which was proved by medical certificate would be set aside. The
Supreme Court said that unsoundness of Mind is a finding of a fact or a question of fact.

Section 68

If a person, incapable of entering into a contract, or any one whom he is legally bound to
support, is supplied by another person with necessaries suited to his condition in life, the person
who has furnished such supplies is entitled to be reimbursed from the property of such incapable
person.

# Nash v. Inman

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The price of the waist coat in this case was held to be non-recoverable. Two conditions were laid

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down in order for this section to apply.

a. The agreement must be for a necessity.

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b. The person should not already have sufficient supply of such necessities.

#Chappel v. Cooper

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It was held that the things necessary are those without which an individual cannot reasonably
exist. In the first place the food, remints (cloth), lodging & like. As the proper cultivation of the

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body is expedient, so is that of the mind. Instruction in art or trade or intellectual, moral,
religious education etc. may be necessary also. However, the article of mere luxury are always
excluded. Thus, necessary are a relative fact determine on the basis of circumstances.
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Apart from entering into contract like relation, another way of providing necessaries or luxury to
a minor is through gifts or charity. In cases of Gifts or charity there is no obligation recipients
to return anything back. However, in the future if the recipients (Minor on attaining majority)
decide to compensate for the past voluntarily services, it will be valid under section 25 of the
Indian9UContract
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