The Competency of the Parties to Contract

Introduction to Legal System

ToProf. Vignesh Mishra

By Tapish Pandey

©® Tapish Pandey

Tuesday, 27 March 2012

The Competency of the Parties to Contract under Indian Contract

Act 1872.


Act 1872.


Act 1872.

©® Tapish Pandey Tuesday, 27 March 2012

Section 11 of the Indian Contract Act states that

“Every person is competent to contract,

Who is the age of majority, who is of sound mind and

who is not disqualified fromContracting by law.”


They have attained the age of majority

They are of sound mind They should not disqualified from contracting by any other law to which they are subject.

Capacity to contract


Minors Person of unsound mind

Persons disqualified by any other law of the land

Not competent to contract


Incapacity

Minority

Unsound mind

Lunatic

Idiot

Drunkard

Disqualifi

ed by law

Alien Enem

y

Convicts

Corporation


Minors

According to section 3 of the Indian

Majority Act “A minor is a person who

has not completed eighteen year of age.”

but the some Act also explains that in two

cases a person attains majority only after

he completes his age of twenty one year :


Where a court has appointed guardian

of a minor’s person or property or

both.(under the guardians and wards)

Where the minor’s property has been

placed under the superintended of a

court of wards. Tuesday, 27 March 2012©® Tapish Pandey

Law relating to minor's agreementA minor can take advantage of his acts but does not incur any kind of obligation.

He can not be personally liable for any of his wrongs.

No legal action can be taken against him for his misbehavior or false promises.


Person of unsound mind IdiotLunatic Seriously IllDrunkard Hypnotized persons

Mental decay


An idiot is a person who is unsound mind by birth.

Idiot

Seriously ill

A person suffering from high fever is also not capable of understanding the nature and implications of a agreement .


A person whose mental powers are deranged is called a lunatic. Agreement made with lunatic , except those made during lucid intervals(period in which he is in his senses) is void .

Lunatics


A person under the influence of drink or drugs stands on the same footing as lunatic. An agreement with drunker is void.

Drunkards


Persons disqualified by laws Alien enemy Foreign sovereigns,

diplomatic staff Corporations and

companies Insolvents Convicts Perdanasheen

women ©® Tapish Pandey Tuesday, 27 March 2012

©® Tapish Pandey

Alien Enemy a person who is not a citizen of India is called an alien.ConvictsConvict is incapable of entering into contract. And the incability ends when sentence expires or punishment finish.

Tuesday, 27 March 2012

:

CorporationA company is artificial person created by law. It can only contact through its board of directors.


Section 11 of the Indian Contract Act 1872 specifies that every person is competent to contract provided -

He should not be a minor.

He should be of sound mind while making a

contract.

he is not a person who has been personally

disqualified by law.

Conclusion


Thank You


The Competency of the Parties to Contract

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