Minor contract | X, a person of 17 years of age by fraudulently misrepresenting himself to be of 19 years, agreed to sell a plot of land to Y… Analyze the legal position of a minor’s contract.

Question: Minor contract | X, a person of 17 years of age by fraudulently misrepresenting himself to be of 19 years, agreed to sell a plot of land to Y for Rs. 10 lakhs and took an advance of Rs. 2 lakhs from Y at the time of entering into an agreement to sell. The time of registration of the sale deed was within 90 days from the date of agreement to sell.

X later refused to execute and register the sale deed. Y filed a suit for specific performance of contract or refund of advance paid. Analyze the legal position of a minor’s contract. Discuss the statutory provisions and refer to decided cases. [HPJS 2018]

Find the answer to the mains question only on Legal Bites. [Minor contract | X, a person of 17 years of age by fraudulently misrepresenting himself to be of 19 years, agreed to sell a plot of land to Y… Analyze the legal position of a minor’s contract.]

Answer

Section 11 of the Indian Contract Act, 1872 says that a minor (below 18 years of age) is not competent to enter into a contract. If he enters into the contract anyway, the contract is void. Now, a minor’s agreement is free of all its effects because the contract is void and anything void cannot have consequences. Following are the legal effects of a minor’s contract:

1. If a minor enters into a contract, even on false pretenses, he will be free of all charges.
2. If a minor enters into a contract and commits a tort, he, again, must not be held liable for entering into the contract or the tort committed (if tort and the contract are connected).
3. A minor cannot restitute a contract once he becomes a major.

Any person who has not reached the age of majority, as stated by the law, is considered a minor.

Section 3 of The Indian Majority Act, 1875, states that a person who has not reached 18 years of age, is a minor. The exception to this is if the child’s guardian is appointed by the court (lawful guardian), then the age of majority is 21 years.

A minor’s agreement is when a minor enters into an agreement (which is void ab initio according to the law).

Section 10 of The Indian Contract Act,1872, says that the parties entering into a contract must be competent to contract (suitable/qualified by law). On the other hand, section 11 of the Indian Contract Act says that a minor (below 18 years of age) is, therefore, not competent to enter into the contract.

In England, under the Infants Relief Act, 1874, the following situations are absolutely void-

1. Repaying the lent money
2. Goods that are supplied
3. Accounts stated.

A controversy pertaining to Section 10 and 11 started during the early 1900s; the controversy being if the minor’s agreement was void ab initio or was it voidable at the minor’s convenience. In the landmark case of Mohori Bibee v. Dharmodas Ghose [(1903) 30 Cal. 539], Dharmodas Ghose (a minor) mortgaged his property in favor of Mr. Brahmo Dutt (who had the knowledge that the plaintiff was minor). A suit was filed by Dharmodas against Mr. Dutt on the basis that he was a minor and hence the mortgage should be void. The judgment of the case held that any contract that involves a minor will be void ab initio so in this case, the mortgage deed was also void.

Effects of a Minor’s Agreement

Minor’s agreement, as stated above is void so both the parties involved in the contract are not obligated to perform, therefore, all the effects of this agreement work independently of the contract. The effects of a minor’s agreement are briefly discussed below:

1. No Estoppel Against Minor

A minor who enters a contract under false pretense and claims to be a major, there will be no estoppel against him and he legally does not need to prove his age in front of the court. The reason behind this is to protect the minors from liability he owes to the major. This was held in the case of Jagar Nath Singh v. Lalta Prasad [(1908) 21 All 21] that no estoppel shall be invoked in the case of a minor as the contract, by law, is already void ab initio.

2. No Liability in Contract or in Tort Arising Out of Contract

“You cannot convert a contract into a tort to enable you to sue an infant.” A minor is incapable to give his consent to enter a contract and therefore, in a contract without consent, no legal action can be taken whatsoever as the contract is void (contract being non-consensual). Hence, an infant who falsifies his age to enter a contract is not liable to pay the compensation or damages during the breach of the contract. Therefore, a minor is not liable for anything in this case.

The case is, therefore, a little different when it comes to tortious liability, a minor can be sued and must pay compensation when it comes to committing torts like negligence or trespass. In Burnard v. Haggis [(1863) 143 ER 360], an undergraduate (a minor) from Cambridge hired a horse for riding and during the contract mentioned that he would not use it for jumping. He further lent it to his friend who used the horse for jumping and the horse injured itself. It was held that the infant was liable as the act which caused the injury was outside the range of the contract and could not be used to prove that it was a breach of the contract. It was not an abuse of the contract.

3. Ratification of a Contract

There is no such thing as ratification of a minor’s contract. If a person, during the time of entering into the contract is minor, then the contract is void. The minor after becoming a major, cannot rectify the contract (the contract if rectified, will not be valid). However, In the Kundan Bibi v. Sree Narayan [(1906) 11 CAL W.N. 135] case, a minor enjoyed the benefits of a contract during his minority years and after attaining majority as well. It was held by the court that because there is valid consideration (after attaining majority), the contract is valid.

4. Doctrine of Restitution

If a minor misrepresents his age and claims to be an adult and also enters into a contract, he can be asked to restore the goods in his possession that were part of the contract, as long as they are in his possession (not sold/given to someone else or converted them) and it is not a consideration (money). If asked to do so otherwise, it would mean enforcing a void contract i.e., a minor’s agreement.

Applying the aforesaid legal principles regarding the position of minor’s agreement to the present case at hand, where X, a person of 17 years of age by fraudulently misrepresenting himself to be of 19 years, agreed to sell a plot of land to Y for Rs. 10 lakhs and took an advance of Rs. 2 lakhs from Y and later refused to execute and register the sale deed. Y cannot file a suit for specific performance of contract or refund of advance paid. The reason being one cannot file a suit for restitution of monetary benefit gained by the minor from the agreement entered by him.

It is a well-settled law that if the consideration of the minor’s agreement is money cannot be restituted against X and if acted otherwise, it would mean enforcing a void-ab-initio agreement which is not possible in the eyes of law.

Thus, to conclude, if a minor enters into a contract, he will not be liable, he will not be asked to compensate for the breach of the contract and he cannot restitute a contract after he becomes a major.

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Law of Contract Mains Questions Series: Important Questions for Judiciary, APO & University Exams

1. Law of Contract Mains Questions Series Part-I
2. Law of Contract Mains Questions Series Part-II
3. Law of Contract Mains Questions Series Part-III
4. Law of Contract Mains Questions Series Part-IV
5. Law of Contract Mains Questions Series Part-V
6. Law of Contract Mains Questions Series Part-VI
7. Law of Contract Mains Questions Series Part-VII
8. Law of Contract Mains Questions Series Part-VIII
9. Law of Contract Mains Questions Series Part-IX
10. Law of Contract Mains Questions Series Part-X