This article on “Legal validity of Minor’s agreement in India” was written by Shudhi Malhotra, an intern at Legal Upanishad.
Introduction
This article discusses the Legal Validity of the Minor’s Agreement in India and its provisions and case laws related to it. The Indian Contract Act, 1972, Section 10, states that not all agreements qualify as contracts. Only agreements signed by parties who have the legal capacity to do so are considered contracts. Furthermore, Section 11 of the Indian Contract Act defines “capable” as including the following three criteria:
- The individual must be of legal age, or at least 18 years old.
- When the contract is made, he should be competent to enter into it.
- Any law that he is subject to shouldn’t prevent him from signing contracts. Before engaging in a contract, it might be argued that majority approval is necessary.
Who is a minor?
A minor is an individual who does not have the same legal rights as an adult because they are under the legal age of majority as defined by the regulation of the jurisdiction in which they live. Generally speaking, a minor is someone who has acquired all of the rights and obligations of an adult but has not yet achieved the age of majority. Minor cannot be held accountable or responsible for their conduct. The typical majority age is 18 years old.
However, as the permitted drinking age in the United States is generally 21, even if a person is at least 18 years old, they may still be referred to as juvenile in alcohol legislation. A minor is a person who has not attained the age of 18 according to Section 3 of the Indian Majority Act of 1875. If a custodian of a minor’s individual or belongings is assigned, the minor becomes 21 years old.
What is Minor’s agreement?
Any person who is of legal age under the decree to which they are subject, who is of sound mind, and who is not prohibited from contracting by any ordinance to which they are subject is capable of agreeing, according to Section 11 of the Indian Contract Act of 1872. Therefore, a minor cannot engage in a contract.
AGE OF MAJORITY: Section 3 of the Indian Contract Act of 1875 means that any individual residing in India reaches adulthood when they turn 18 years old.
Exceptions: 21 years in the following lawsuits:
- In cases where a guardian of a minor’s individual or belongings has been assigned by the Guardian and Wards Act of 1890.
- When property belonging to a juvenile has been transferred under the control of the bench of remarks.
The effects of minor’s agreement
The results of this momentous decision can be stated by there is no contractual or tort liability: A minor is incapable of giving permission, and any agreement they make is invalid and cannot be implemented because of this.
Rule of Estoppel: It is a lawful principle of proof that forbids a party from causing an allegation that is inconsistent with what he has already said. The tribunal ruled that the estoppel theory does not lay in cases when the individual involved already understands the existence; in this instance, the defendant’s attorney was familiar that the complainant was a minor. This regulation does not thus lay on.
Restitution of benefit: Section 64 of the Indian Contract Act means that when a party who has the opportunity to nullify an agreement does so, the further party is not required to fulfill their obligations under the contract. This is true for voidable contracts, but a minor’s contract is void, thus he cannot be required to pay the finances back to the lender.
The exception in the generally applicable rule
For protecting minors. His agreement is unlawful since it shielded a child. But there are also some exceptions.
Upon completion of the minor’s duty: A minor may be both the promisee and the promisor in a contract, but not both. If the juvenile is in the role of the promisee and has upheld his end of the bargain but the other party hasn’t, he or she may be able to enforce the contract.
An agreement made by the minor’s guardian for his advantage: A minor may then file a lawsuit against the other party if it breaks its assurance. In the lawsuit of Great American Insurance v. Madan Lal, the custodian of the minor’s property signed an insurance contract on behalf of her son. The insurance refused to pay out when the belongings were sabotaged and the minor requested reimbursement, claiming that an agreement with the minor is invalid. Delinquent, however, the bench ruled that this agreement was valid, and he is now required to make restitution.
The Contract of apprenticeship: A contract of apprenticeship entered into by a custodian on behalf of a child under 18 years is enforceable under the Indian Apprentices Act of 1850.
Necessity supplied to a minor
If someone unable to engage in a contract is given the requirements of life by another person, even a child, the person who assisted is entitled to compensation from the incompetent person’s property. However, the youngster cannot be forced to pay back the other person if he has no property of his own.
Case Law
Mohribibi vs. Dharmodas Ghosh (1903)
Facts
The complainant, Dharmodas Ghosh, loaned a juvenile Rs. 20,000 while he was still a minor by pledging his belongings to the defendant, a moneylender. The defendant’s attorney was then aware of the plaintiff’s age. Later, the plaintiff consented to pay Rs 8000 but vetoed the balance. He sued the defendant, claiming that because he was a minor at the time the contract was formed and as such, he is not obligated by the agreement, on behalf of his next friend and current legal guardian, the plaintiff’s mother.
Decision
According to section 11 of the Indian Contract Act of 1872, minors are not permitted to engage in contracts, the privy council ruled in its ruling. Section 11 of the Indian Contract Act of 1872 provides that every individual who is of the age required by the ruling to which they are subject is competent to contract. Any agreement with a minor is therefore Void ab initio. A valid contract is stated to satisfy all of the conditions outlined in section 11.
The court further ruled that the agreement with the minor is void. A minor cannot enter into a contract, hence the mortgage was void. The minor is not obligated to keep any promises he made in connection with the contract, thus he cannot be forced to reimburse the finances that were granted to him. Additionally, the minor is not covered by estoppel legislation.
Can a minor be a partner?
The formation of a contract results in the formation of a partnership, and both parties to the contract must be of legal age. The minor may, however, be accepted to the advantage of the coalition for the period being with the proper approval of all the members, as an exemption under Section 30 of the Partnership Act. But he won’t be held responsible for any of his actions.
Conclusion
A minor is not allowed to come into a contract under the Indian contract Act, of 1872 and such a contract would be null and void from the beginning. Minor cannot rely on the ratification of the agreement he reached during his minority when he becomes a member of the majority. A contract that was void in the past cannot be made lawful later on because ratification refers to a time when the individual was still a minor. After reaching the age of the majority, a new contract may be made with new considerations if necessary.
Furthermore, a minor’s agreement cannot be demanded to be performed specifically since doing so would mean carrying out a full agreement. A youngster will only be held accountable for claims for necessities, though.
References
- Validity of the minor’s agreement https://www.a-and-s-jurisprudentia.com
- What is the position of minors under the Indian Contract Act of 1872? https://lexforti.com/legal-news/what-is-the-position-of-minor-under-indian-contract-act-1872/#CONCLUSION
- Minor’s Capacity To Enter Into A Contract https://blog.ipleaders.in