THE INDIAN CONTRACT ACT, 1872

MINOR

Presented by:
Name- Angela Ahuja
Roll no.- 16
MBA 1st Semester
Section A
 CAPACITY TO CONTRACT–MEANING

 Every person is competent to contract who is of:

 the age of majority according to the law to which he is subject,
 sound mind, and
 is not disqualified from contracting by any law to which he is subject.

 Section 11 declares the following persons to be incompetent to contract.

 Minors
 Persons of unsound mind
 Persons disqualified by any law for the time being in force.
 Idiot
 Lunatic with unsound mind
 Alien enemy
 Convicts
MINOR - MEANING

 Minors: according to Section 3 of the Indian Majorities Act, 1875, a minor is a person who has not
completed eighteen years of age. In the following two cases, he attains majority after twenty one
years of age:

 Where a guardian of a minor’s person or property has been appointed under the guardian and wards
Act, 1890, or

 Where the superintendence of a minor’s property is assumed to be court of wards.

 The rules governing minor’s agreements are based on two fundamental rules:

 The first rule is that the law protects minors’ against their own inexperience and against the possible
improper designs of those more experienced.

 The second rule is that, in pursuing the above object, the law should not cause unnecessary hardship
to person who deals with minors.
LEGAL RULES OF MINORS:

 An agreement with minor is void- ab-inito:

 He can be a Promisee or a Beneficiary: incapacity of minor to enter into a contract
means incapacity to bind him-self by a contract. There is nothing that debars him from
being a beneficiary. Such contract may be enforced at the option of the minor and not
the other party.
 Minor cannot ratify his contract, on attaining majority: “Consideration which passed
under earlier contract cannot be implied into the contract which the minor enter on
attaining the majority. Thus consideration given during the minority is no consideration.
If it is necessary a fresh contract may be entered into by the minor on attaining the
majority provided it is supported by a fresh consideration
 He can always plead minority: even if he has, by misrepresenting his age, induced the
other party to contract with him, he cannot be sued either in contract or in tort for fraud
because if the injured party were allowed to sue for fraud, it would be giving him an
indirect means of enforcing the void agreement.
CASE LAWS
 Case law: M, A minor, borrowed Rs.5000/- from L and executed a Promissory note in
favour of L. after attaining the majority, he executed another Promissory note in
settlement of the first note. The second Promissory note is void for the want of
consideration. (Indran Rama Swamy v/s Anthiappa Chettiar)

 Case law: M, Aged 17, agreed to purchase a second hand scooter for Rs.5000/- from N.
he paid Rs.200/- as advance and agreed to pay the balance the next day and collect the
scooter. When he came with the balance money next day, N told him that he has
changed his mind and offered to return the advance. N cannot avoid the contract, though
M may, if he likes. (Sharafat Ali v/s Noor Mohd)

 A minor mortgaged his house in favour of a money lender to secure a loan of Rs.20,
000/- Subsequently the minor sued for setting a side the mortgage, stating that he was
underage when he executed the mortgage. Held, the mortgage was void and, therefore,
it was cancelled. Further the money lender requested for the repayment of the amount
advanced to the minor as part of the consideration for the mortgage was also not
accepted (Mohiri Bibi vs. Dharamodas Ghose)
 LEGAL RULES OF MINORS:

 If he has received any benefit under a void agreement, he cannot be asked to

compensate or pay for it: section 65 which provides for restitution in case of
agreements discovered to be void does not apply to the minor
 There can be no specific performance of the contract with minor, since agreement
with minor is void-ab-inito: Can’t file a suit for specific non performance. But if a
contract is entered into on his behalf by his Parents / guardian then the same can be
enforced by or against the minor provided the contract is (a) within the scope of the
authority of the Parent / guardian, and (b) for the benefit of the minor.
 He cannot enter into a contract of Partnership: a minor can be admitted as a
beneficiary of Profits of a Partnership firm already in existence, with the consent of all
the existing Partners. But he cannot be admitted as a Partner
 He can be an agent: an agent is merely connecting link between Principal and third
Party. The movement the Principal and third party comes into contract with each other,
the agent drops out with any personal liability, hence a minor can act as agent.
 LEGAL RULES FOR A MINOR
 His Parents / guardian are / is not liable for the contracts of the minor: the
exemption to this rule is that where the minor act as an agent of his Parent / guardian,
the Parent / guardian shall be liable for his acts.

 He cannot be adjudged as an insolvent.

 He cannot be a shareholder in a Company.

 He can be member in a Trade union: A Person who attained the age of 14 years can be
admitted as a member.

 Minor’s liability for necessaries: a minor is liable to pay out of his property for
“necessaries” supplied to him or to anyone whom he is legally bound to support (Section
68). The claim arises not out of contract but out of what are called Quasi-Contracts.
Again it is only the property of the minor, which is liable for meeting the liability arising
out of such contracts. He is not personally liable.
LEGAL RULES OF MINORS:
 No rule of Estoppel to minor
 Estoppel means A person making a statement by words spoken or written which
induces others to believe and acted upon.
 Rule preventing a person from denying the truth of such a statement made previously by
words spoken or written, by which he has led another to believe and acted upon.
 Therefore, he is stopped from denying the said statement.i.e. cant say no, so should act.
 Ex: Mr. M, a minor, obtains a loan by mortgaging his property. He is not liable to refund
the loan not only that, even his mortgaged property cannot be made liable to pay the
debt.
 Minor is liable for Tort

 Surety for a Minor: a person who stands as surety for a minor can be sued though the
minor himself would not be liable