CONTRACT BY MINOR

Updated: Feb 27


CONTRACT BY MINOR

A contract is an agreement made between two or more individuals creating responsibilities which are enforceable or otherwise recognizable at law. A contract is an agreement enforceable by law. The Contracts or agreements among various individuals are formed and validated as per the provisions of the Indian Contract Act. As per the Indian Contract Act, 1872, the term “Contract” means under its section 2 (h) as an agreement enforceable by law.


The essential elements of a valid Contract are:

  • Offer and Acceptance

  • Intention to create a legal relationship

  • Lawful Consideration

  • Competent parties

  • Free consent

  • Lawful Object

  • Not being expressly declared void

Section 10 of the Contract Act requires for the parties to be competent to contract. The competence of the contract is defined under Section 11. Under S. 11 every person is competent to contract who is of the age of majority according to the law to which he is subject, who is of a sound mind and lastly, is not disqualified from contracting by any law to which he is subject. Further, the section declares that the following are the persons who are incompetent to contract-

  • Persons who have not attained the age of majority.

  • Persons who are of unsound mind.

  • Persons who are disqualified from entering into contracts by any law in force at that particular time and to which that person is subjected.

In the Indian context, the age of the majority is usually 18, except for when there is any guardian of a person or property, appointed by the court. Therefore, in such a case, the age of majority becomes 21[1]. In England, earlier the age of majority was 21 years but then after the Family Law Reform Act, 1969, it was changed to 18. Furthermore, earlier, the term ‘infant’ was used instead of ‘minor’. The controversial and confusing nature of a minor’s agreement was given a bit more clarity in 1903 by the Judicial Committee in the case of Mohori Bibee vs Dharmodas Ghose. [2]In this case, a minor mortgaged his property to the defendant. But at that time, the defendant’s attorney was aware of his age. The plaintiff only paid Rs. 8000 but refused to pay the rest of the amount. Subsequently, the plaintiff brought an action against the defendants and claimed that at the time of the contract, he was a minor, and therefore, the contract is void. The court heard both the parties and held that if the parties do not have competence under Section 11 of the Act no agreement is a contract.


A minor is unequipped to give his/her assent, and the idea of a minor's understanding is a nullity and can't be implemented. Estoppel is a lawful standard of proof that keeps a party from going back on their expressed promise. The court held that the principle of estoppel doesn't have any significant bearing to a case where the individual knows the genuine realities, beforehand and here the lawyer of the litigant realized that the offended party was a minor. Consequently, this standard doesn't make a difference. As per Section 64 of the Indian Contract Act, when an individual at whose choice an agreement is voidable revokes it, the other party need not perform it. This applies to agreements that are voidable, yet a minor's agreement is void, and accordingly, he can't be approached to pay off the remaining money to the defendant.


In an agreement, a minor can be a promise however not a promisor. So, in such a situation, if the minor has played out his piece of the guarantee, yet the other party hasn't the minor being in the situation of a promise he can uphold the agreement. An agreement went into by the guardian of the minor for his advantage: all things considered; a minor can sue the other party when it doesn't play out its guarantee. In Great American Insurance v. Madan Lal[3], the guardian for the sake of her child went into a contract for the minor's property to be protected. At the point when the property was harmed and the minor requested the money, the other party denied it by saying that an agreement with a minor is void. In any case, later the court held that this agreement was enforceable, and he is at risk to pay. Under the Indian Apprentices Act, 1850, an agreement of disciple entered by Guardian for his sake is authoritative on the minor.


If an individual is incapable of entering into an agreement and is provided by someone else with necessities of life, the individual who has provided is qualified to get repayment from the property of such an in competent individual, including from that of a minor. Be that as it may, if the minor has no property of his own, he can't repay the other individual. A minor can never be a principal because Section 183 of the Indian Contract Act for anyone to be competent, he ought to be of the majority age and be of sound mind. Since a minor isn't capable to contract, he likewise cannot be an agent. In any case, a minor can turn into an agent according to the arrangements of Section 184 yet the principal will be limited by the demonstrations of the minor.


Thus, it could be said that as per law, an agreement formed and entered into by a minor is void. The Indian Contract Act states that only an individual who is a major that is competent to contract. The primary reason is that an agreement, through which a minor includes a promise on his part or his promise is an essential part of the agreement, becomes void since a minor is not qualified to make a promise imposing a legal obligation. And in line with this, an agreement cannot call for specific performance by a minor. In conclusion, Minors are not burdened by law to comply with obligations.


REFERENCES

[1] The Indian Majority Act, 1875, s. 3 [2] ILR (1903) 30, Cal 539 (PC) [3] (1935) 37 BOMLR 461

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