Rules regarding contracting made by minors

Rules regarding contracting made by minors

Persons of sound mind and disability

According to Sec. 11 of the Indian Contract Act, it is essential that the parties to a contract must be of sound mind otherwise the contract shall be considered to be void. Persons of ‘unsound’ mind, have been indirectly described in Sec. 12 of the Indian Contract Act. According to it, “A person is said to be of sound mind for the purpose of making a contract, if at the time when he makes it, is capable of understanding it and of forming a rational judgement as to its effect upon his interests”. Thus, soundness of mind of a person depends on his capacity of understanding the contract and on his ability to form a rational judgement as to its effect upon his own interests.

The persons of unsound mind could broadly be classified as under :

(1) Lunatics. There are certain persons who are generally of unsound mind but occasionally of sound mind. Such persons can make lawful contract when they are of sound mind. But in this case, the onus of proof lies on such a person who made the contract that he was of sound mind and had capacity to understand the contractual obligations.

Such persons are included under the lunatics’ cat-
egory. They might lose their mental balance due to some mental trouble or other personal causes. If under the Indian Lunacy Act, the court declares someone as ‘lunatic”, then till the issuance of further orders of the court, the contracts made during their mental illness too shall not be lawful and valid.

Example. A person who is in a lunatic asylum, and who at intervals, is of sound mind; may contract during those intervals. But it is obligatory on the part of the other party to establish that such a person was in the state of sound mind when he contracted with him.

(2) Drunkards or Intoxicated Persons. A person who is usually of sound mind but occasionally of unsound mind, may not enter into a lawful contract when he is of unsound mind. A sane person who is in the state of delirium because of fever or other sickness or is so much drunk that he cannot understand the rationality or terms and conditions of the contract, cannot contract so long as delirium or drunken state, continues. In this case, the onus of proof lies on such a person that out of delirium or drunken state he was not in a position to understand the rationality of the contract, if he desires for the contract to be held invalid.The

(3) Idiots. An idiot is a person who has fully lost his mental power and is quite incapable to understand the effect of the contract in his own interest. An agreement with an idiot is void and not enforceable at law. Although an agreement with or by a person of unsound mind is void, yet such persons are liable for necessaries supplied to them or their minor dependents. Even in such cases, only the estate of the persons unsound mind is liable and no personal liability is attached to them.

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