This article is written by Abhay Pandey, Student, K.S. Saket P.G. College, Ayodhya.
From section 11 of the Indian Contract Act, 1872, it becomes clear that a person who will be competent to contract if he has attained the age of majority. According to Section 3 of the Indian Majority Act, 1875, a person shall be deemed to have attained his majority when he completes the age of 18 years, but if for person or property or both the minor, a guardian has been appointed by the court, he will be deemed to have attained his majority when he completes the age 21 years.
However, it is to be noted that the Indian Majority Act has been amended in the year 2000, by this amendment the age of majority has been made uniform age of majority is 18 years.
Nature of minor’s agreement
From section 10 and section 11 of the Indian Contract Act, it is clear that the person who, by reason of infancy, is incompetent to contract, he cannot make a contract within the meaning of the Indian Contract Act. Consequently, a minor’s agreement is void ab initio and can not be enforced by either of the party to the contract.
The plaintiff, A, while he was a minor, mortgaged his property in favor of the defendant, B, who was a moneylender to secure a loan of Rs. 20,000. The actual amount of loan given was less than Rs. 20,000. At the time of the transaction the attorney, who acted on behalf of the moneylender, had the knowledge that the plaintiff is a minor. The plaintiff brought an action against the defendant stating that he was a minor when the mortgage was executed by him and, therefore, the mortgage was void and inoperative and the same should be canceled. By the time of appeal to Privy Council the defendant, B died and the appeal was prosecuted by his executors. The defendant, amongst other points, contended that the plaintiff had fraudulently misrepresented his age and therefore no relief should be given to him.
The court held that unless the parties have competence under section 10, no agreement is a contract.
Exceptions of minor’s agreement
- Restitution of benefits: In English law, when the minor makes a false representation as to his age and induces other parties to make a contract with him. The minor can be compelled to return the benefit or property received under the contract only when it is identifiable and still in minor’s possession. While in Indian law the minor’s agreement is void ab initio and therefore cannot be enforced by either party even when minor falsely represents to be major and induces other parties to make a contract with him.
- Khangul v. Lakha Sing: In this case, the Lahore High Court has held that the power to give equitable relief was more extensive in India than in England and ordered monetary compensation in a case where the minor had misrepresented his age.
- Ajudhia Prasad v. Chandan Lal: In this case, it was held that the mortgagee was not entitled to a mortgage decree, nor was he entitled to a decree for the principal money under any equitable principles other than those recognized in England.
- No estoppel against a minor: Section 115 of the Indian Evidence Act, 1872, lay down the law of estoppel but the Indian Contract Act make it clear that a minor is incompetent to contract thus a minor cannot incur liability under any contract and the rule of evidence cannot be invoked to defeat this section.
- Gadigeppa Bhimappa Meti vs Balangowda Bhimangowda: In this case, the Bombay High Court has observed that there can be no estoppel against an act of parliament or against an act of the legislature and the principle of estoppel cannot be invoked against the plain provision of the statute.
- Ratification of minor’s agreement: An agreement with a minor is void and therefore it cannot be ratified by the after attaining the age of majority and the consideration given to the minor during minority cannot be a valid consideration for the promise made by him after attaining the majority.
- Contract of apprenticeship: Under Indian Apprentice Act, 1850, a contract of apprentice entered by guardian on his behalf is binding on the minor.
- Necessities supplied to a minor(section 68): The general rule is that if a person is incapable of entering into a contract is supplied by another person with necessities of life, the person who has supplied is entitled to get reimbursement from the property of such incompetent person, including a child as well.
Illustration: A supplies the wife and children of B, a lunatic, with necessaries suitable to their condition in life. A is entitled to be reimbursed from B’s property.
But if the minor has no property of his own, then he cannot be bound to reimburse the other person.
Minor as a partner
According to Section 30 of the Indian Partnership Act, 1932, a minor cannot be a partner but can be admitted into the benefits of partnership.
- In Commissioner of Income Tax v. Dwarka Das, it was held that an agreement of partnership making a minor full-fledged partner is invalid qua all partners.
- In Gurusaran Lal v. Seral Kumar, it was held that if the guardian of a minor agrees to get a share of profits in lieu of interest on the minor’s advanced by the guardian to a partnership, the agreement is not void.
From the above discussion, it is very clear that an agreement with a minor is void ab initio in India. A minor is generally liable in tort, but he cannot be liable for what was in truth a breach of contract by framing the action ex delicto. In Manmatha Kumar Saha v. Exchange Loan Co., it was held that ‘You cannot convert a contract into a tort to enable to sue minor’.