Sec. 11: Who are competent to contract Sound mind An agreement entered into by a person who was of unsound mind at the time of making it is void. In English law a contract by a person lacking mental capacity is not void but is voidable at his option, if he can show that woing to his mental condition he did not understand what he was doing, and the other party was aware of his unsoundness of mind at the time of making the contract. emSec. 12: What is a sound mind for the purposes of contracting + Requirement under Sec. 12 is that the party to a contract must be capable of understanding the contract and of forming a rational judgement as to its effect upon his interest at the time of making of the contract. * There being a presumption in favor of sanity the person who relies on the unsoundness must prove it sufficiently to satisfy the test. * Mere weakness of mind is not unsoundness of mind.Sec. 12: What is a sound mind for the purposes of contracting * A person who is usually of unsound mind but occasionally of sound mind may make a contract when he is of sound mind. * Drunkenness: under English law, the test of incapacity by reason of drunkenness was the same as that for persons with mental disorder. * Pitt v, Smith: it was held that a person in a state of complete drunkenness has no agreeing mind.Sec. 13: Consent * Mutual consent = free consent __ is the sine qua non of a valid agreement and one of its essential elements is that a thing is being understood in the same sense by a party as is understood by the other. + The ‘same thing’ must be understood as the whole content of the agreementSec. 14: Free consent + ‘free’ consent is a necessity under Sec. 10 of the Indian Contract Act, 1872 * Where there is no consent or no real consent there can be no contract at all. + Where there is consent, but not free consent, there is generally a contract voidable at the option of the party whose consent was not free. * Consent is said to be free when it is not caused by coercion, undue influence, fraud, misrepresentation, or mistakeSec. 15: Coercion * Committing an act forbidden by the Indian Penal Code, 1860. * Consent is said to be caused by coercion when it is obtained by pressure exerted by either of the following techniques: - a. Committing or threatening to commit an act forbidden by the !.P.C 1860 b. Or, unlawfully detaining of threatening to detain any property——_--—t—O sec. 15: Coercion + Coercion implies committing or threatening to commit some act which is contrary to law. + What the Indian law calls coe! menace. « Duress is said to consist in actual or t imprisonment of the contracting part the other party or by anyone acting with rcion is called in English law duress or hreatened violence or y or his wife, parent or child by his knowledge for his advantageSec. 15: Coercion * Coercion under Sec. 15 is wider than duress: - a. Includes unlawful detention of property b. Coercion may be committed by any person not necessarily a party to the contract. It may be directed towards anyone, even a stranger luress must be such as will cause immediate In English law, di n of ordinary firmness of mind violence and also unnerve a perso! f (these requirements are not required under Indian law)Sec. 16: Undue Influence * Undue influence is defined as the use by one party to the contract of his dominant position for obtaining an unfair advantage over the arty. fluence is said to be employed in following endment): - When a perso: o n whom confidence is reposed by another or who holds a real or apparent authority over the other makes use of s confidence or authority for the purpose of obtaining advantage over that other which but for such confidence or authority he could not have obtainedSec. 16: Undue Influence « Influence has been defined as the ascendancy acquired by one person lal over another. + It may be used widely, * Undue influence is impro ascendancy for the benefi sets of the person influenced are n judiciously and helpfully. per use by the ascendant person of such it of himself or someone else so that the ot his free, voluntary actsSec. 16: Undue Influence * The principle of undue influence is a doctrine of equity. * The principle applies to every case where influence is acquired and abused, where confidence is reposed and betrayed * The elements of undue influence led to a dominant position, and the sue of it to obtain unfair advantage + It requires the court trying a case to consider two things ~ The relations between doner and done such that the done is in a position to dominate the will of the donor. b. Has the done used that position to obtain an unfair advantage over the donor?