Capacity Of A Minor To Contract

This blog is inscribed by Nishant Tiwari.

Incompetency Of A Minor To Contract –

Section 10 of the Indian Contract Act, 1872 defines what agreements are contract and section 11[1] defines the non-competency of a minor to contract. But neither section makes it clear whether, if a minor enters into an agreement, it would be voidable or void agreement. In 1903, the controversy was resolved by the judicial committee of  privy  council in their well-known pronouncement in Mohri Bibee v.Dhurmodas Ghose[2], which held that the minor’s agreements are void ab initio.

A minor’s agreements are void ab initio and ordinarily, it should be wholly devoid of all effects. The effect of minor contract can be well-understood into different ways:

  • No estoppel against minor-If any minor misrepresent his age or induces another person to enter into a contract, then, there is no estoppel against him. The infant is not stopped from setting up defence of infancy. The reason is very simple, that there can be no estoppels against a statute. The law is protecting person below the age which defines by act established by law.
  • No liability in contract or in tort arising out of contract-A minor is in law incapable of giving consent, and, there being no consent, there could be no change in the character. In England, it was laid down as early as 1665 in Johnson .v Pye[3], that the court held that if any minor misrepresent his age to obtain a loan cannot be held liable to repay that loan. The court held that a minor cannot be held liable for anything which would be indirect way of enforcing his agreement and that one cannot convert a contract into a tort to enable him to sue an infant.
  • Doctrine of Restitution-When any agreement or contract becomes void, and any person who has received the advantage of such agreement or contract is obligated to restore it or compensate it to the person from whom it was received. If an infant who misrepresents his age and enters into a contract with another person, he may be forced to restore it, but only as long as the same can be tracked in his possession. This principle is known as the equitable doctrine of restitution. Also, when the minor sold the goods or convert the goods for himself, he is not obligated to repay the value of the goods, because that would amount to enforcing a void contract.

Claim For Necessaries Supplied To Person Incapable Of Contracting, Or On His Account-

If any person who is not capable to enter into a contract, such as a minor or an insane person, or any person who is legally obligated to support that person, is provided by another person with the needs appropriate to their condition in life. The person who has provided such supplies, is entitled to be reimbursed from the property of said incapable person.

Liability is only for the necessary, but there is no such definition of the term “necessary” provided in Act. Consequently, we can resort to judicial decisions to determine its precise importance. For an infant’s estate to be responsible for necessities, two conditions must be met, namely:

  • The contract must be supply of necessity for his support in his life
  • He already must not have a sufficient supply of these necessities.

The supplier has to prove that not only that goods supplied were suitable to the condition in life of the infant, but also that, he was not sufficiently supplied with the goods of that class. This is the principal laid down on the case of Nash v. Inman[4], where an undergraduate student of Cambridge university, who was amply supplied with proper clothes according to his position, was supplied by the plaintiff with a number of dresses, including eleven fancy waistcoats. The price was held to be irrecoverable and thus, the plaintiff was not able to recover any amount from the defendant as the court held that a number of dresses including eleven waist coat are not under the necessity which was supplied by the plaintiff.

Guardian’s Power To Bind Minor-

A guardian can intervene to supplement the minor’s inability to contract. If it were otherwise, it can act as a great detriment to the minor’s property. On the other hand, it is also necessary to impose restrictions on the guardian’s power, to avoid the abuse of his power and to prevent the minor’s property from exploiting. The law tries to achieve these conflicting values and a guardian for the purpose of dealing with the property of a minor must fall into any of the following three categories:

  1. Guardian must be appointed by a civil court or a court of ward.
  2. He/she must be a Testamentary guardian.
  3. He/she must be a Natural guardian.

The appointment of a guardian by a civil court is governed by theGuardian and Wards Act of 1890. The Law establishes how a guardian must treat the assets of a minor. Section 27[5] says that the person has to deal with the property as a man of ordinary prudence i.e., would treat as if it were his own and can do all the acts that are reasonable and appropriate for the realization, protection or benefit of the property. In addition, pursuant to section 29[6], the guardian is prohibited, without the prior permission of the court, from mortgaging or collecting or transferring by sale, gift, exchange or otherwise, any part of the minor’s immovable property or to lease any part of that property for a term of more than five years or for any period that extends more than one year after the date on which the ward will cease to be a minor. Section 30[7] makes the disposition of any immovable property by a guardian voidable, in contravention of the previous dispositions at the request of any other affected person. The court does not grant permission to dispose of real estate, except in case of need or for an obvious advantage for the minor.

Some points can be observed, since in both provisions, a guardian cannot dispose of immovable property, without the permission of the court. The statutes are silent on the purchase of immovable property. For a probate or testamentary guardian, court permission is not required to dispose of immovable property. It is clear by law that a guardian cannot contract on behalf of the minor, to impose his/her personal obligations on a minor.

[1] Section 11, The Indian Contract Act, 1872.

[2](1903) 30 Cal 539 (PC)

[3]82 ER 1091

[4](1908)2 KB 1, 12.

[5] Section 27, The Indian Contract Act, 1872.

[6] Section 29, The Indian Contract Act, 1872.

[7] Section 30, The Indian Contract Act, 1872.

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