Case Commentary On Mohiri Bibi V. Dharmodas Ghose
- Ira Bhandula (Bharati Vidyapeeth University, Department of Law, Paschim Vihar)
Court- Privy Council
Date of Judgement- 04 March 1903
Name of the judges- Lord McNaughton, Lord Davey, Lord Lindley, Sir Ford North, Sir Andrew Scoble, and Sir Andrew Wilson.
Citation- (1903) ILR 30 Cal 539 (PC)
Introduction:
As per Section 10 of the Indian Contract Act of 1972, it is imperative to note that not all agreements are considered contracts. Only those agreements that are entered into by parties who possess the necessary competence to do so are deemed as contracts. Furthermore, Section 11 of the Indian Contract Act defines the term ‘competent’ and outlines three essential criteria that must be met. These include the individual being of the age of majority, which is 18 years, possessing a sound mind at the time of entering into the contract, and not being disqualified from contracting by any applicable law. It can be inferred that attaining the age of majority is a prerequisite for entering into a contract.
Who is a minor?
A minor is characterized as an individual who has not yet attained the age of 18. In relation to any contract, the condition of majority is a prerequisite. According to Indian law, an agreement entered into by a minor is considered void, indicating that it holds no legal value and cannot be enforced by either party involved. Furthermore, even upon reaching the age of majority, the minor cannot validate or ratify the same agreement. It is important to note that while a minor’s contract is void and lacks legal validity, it is not deemed illegal due to the absence of any statutory provision addressing this matter.
A minor is an individual who, at a specific age, lacks legal rights. This denotes that a minor is an individual who does not possess certain legal rights at a particular age. Minors do not possess the same legal capacity as adults. Typically, minors are not granted the same legal rights as adults until they attain the age of majority. In India, the age of majority is generally considered to be 18 years old, as individuals under this age are still in the process of developing physically, mentally, and in terms of their knowledge. Once minors have attained the age of 18 and have developed both physically and mentally, they are deemed mature individuals. At this juncture, they are regarded as adults and are capable of exercising the same legal rights and responsibilities as fully grown adults.
As per Section 3 of the Indian Contract Act, an existent who’s a citizen of India and is below the age of 18 times is supposed to be a minor. In agreement with this provision, any agreement entered into by a minor is considered void. A minor isn’t fairly able of entering into a contract. Section 2 of the Indian Contract Act stipulates that parties to a contract must retain the necessary capability to enter into an agreement. They mustn’t be of unsound mind, disqualified by law, or a minor. The Indian Majority Act 1875, Section 3, defines the term” minor” as an existent who has not attained the age of 18 times.
Background
The case of Mohori Bibee V/ S Dharmodas Ghose pertains to the compass of agreements involving minors. This case primarily concerns contracts entered into with minors. In India, any agreement or contract made with a minor( an existent below the age of 18 times or someone who has not yet reached the legal age of 18) is considered void ab- initio( void from the veritably morning). similar regulations live because, according to the law, individualities of this age group aren’t supposed able of entering into contracts or agreements.
According to the court’s ruling, individualities who are under the age of 18 or haven’t reached the age of maturity, generally appertained to as minors, warrant the capacity to enter into contracts or make consequential opinions.This legal precedent has established the notion that minors, due to their incapability to give valid concurrence, necessitate securing in their relations with grown-ups. Accordingly, any contractual arrangement or agreement involving a minor is considered null and void from its commencement. These contracts are fairly honoured as” void ab- initio.” In this particular case, the Privy Council has pronounced that any form of communication or agreement made by a minor is supposed” fully null and void”. This ruling has been strictly stuck to and continues to evolve. Section 10( 3) of the Indian Contract Act, 1872 outlines the criteria for determining which agreements are considered fairly binding contracts. also, Section 11( 4) specifies the individualities who retain the necessary capability to enter into a contract.
Whether a minor’s understanding is voidable or void through and through?
Section 10 of the Contract Act is a issue at hand that pertains to the validity of a minor’s agreement addresses around the judgment of the parties and Member 11 addresses roughly individualities who aren’t allowed to enter into a contract. In any case, no clause takes off it certain what the suggestions of a minor entering into an course of action would be, whether it will be invalid and void at his tactfulness or not. As a result, these clauses made a licit problem around the presence of a minor course of action. The Privy Board inescapably settled this struggle in 1903 through the point of interest case of Mohiri Bibi vs. Dharmodas Ghose, where Dharmodas Ghose, a minor, vended his house forRs. 20,000 to a cash moneylender. At the time of the transaction, the legal representative acting on behalf of the moneylender was apprised of the fact that the counterparty was a minor. Subsequently, the minor initiated legal proceedings against the moneylender, contending that he was a minor at the time of the agreement and, therefore, the contract was null and void. However, at the time of the appeal to the Privy Council, the appellant had passed away, and his offspring, Mohiri Bibi, filed the appeal. In clarifying the matter at hand, the Privy Council ruled that the minor’s arrangement was invalid ab initio, meaning it was void from the outset. In the case of a minor, the commonly held belief that “every man is the best judge of his own interest” is not applicable.
What will be the ramifications of a minor’s agreement?
In the event that a minor’s contract is deemed invalid, no party shall be obligated to fulfill any aspect of the agreement, rendering the consequences of the contract null and void. However, if a minor misrepresents their age to deceive another party into entering into a contract, would this pose a legal obstacle for them?
No legal liability arising from any tort or contract can be imposed: A minor lacks the capacity to provide consent, and the validity of any agreement involving a minor is void and unenforceable.
The Estoppel Clause is a valid evidentiary principle that prohibits a party from asserting a claim that contradicts its prior statements. The court has determined that the doctrine of estoppel does not encompass instances where the individual was already aware of the actual facts, as in this case where the defendant’s legal representative was cognizant of the complainant’s minority status. Furthermore, this legal principle is not applicable.
Restitution of benefits: Pursuant to Section 64 of the Indian Contract Act, in cases where an individual, who possesses the authority to render a contract voidable, chooses to rescind said contract, the opposing party is precluded from doing the same. This provision is applicable to transactions that are deemed null and void. However, it is important to note that a contract entered into by a minor is considered null and void, thereby exempting the minor from any obligation to reimburse the moneylender.
Facts:
Dharmodas Ghose served as the respondent within the previously mentioned case. At the time, he was a minor, meaning he had not however come to the age of 18, and he held sole proprietorship of his undaunted property. The Calcutta Tall Court had allowed his mother the specialist to act as his legitimate overseer. Amid the period when Dharmodas Ghose looked for a contract for his undaunted property, which was eventually allowed in support of the appealing party, Brahmo Dutta, he remained a minor. This contract deed was secured for the entirety of Rs. 20,000, with an yearly intrigued rate of 12%. Brahmo Dutta, a cash loan specialist at the time, gotten a advance of Rs. 20,000, with the administration of his commerce depended to Kedar Nath, who acted as his lawyer. A notice was sent by Dharmodas Ghose’s mother to Brahmo Dutta, illuminating him of Dharmodas Ghose’s minority status on the date the contract deed was started. In any case, the genuine sum of credit given was less than Rs. 20,000. The defendant’s agent, acting on sake of the cash moneylender, given reserves to the offended party, who was a minor. The agent was completely mindful of the plaintiff’s inadequacy to enter into a contract and legitimately contract his property. On the 10th of September 1895, Dharmodas Ghose and his mother started lawful procedures against Brahmo Dutta, charging that the contract executed by Dharmodas was started amid his minority or earliest stages, rendering it void and unbalanced. Thus, they looked for the repudiation of the contract. Amid the pendency of the appeal, Brahmo Dutta passed absent, and the agent of his domain kept on prosecutes the matter. The offended party fought that no tolerance or help ought to be allowed to the respondent, as he had deceitfully distorted his age. Moreover, in case the contract were to be cancelled at the defendant’s ask, i.e., Dharmodas Ghose, it would result in an unreasonable result.
Issues some time recently the court-
- Whether the deed was void beneath segment 2, 10 and 11 of the Indian Contract Act, 1872 or not?
- Whether the respondent was at risk to return the sum of advance which he had gotten by him beneath such deed or contract or not?
- Whether the contract initiated by the respondent was voidable or not?
Contention of the appealing party-
The respondent held the status of major at the time of executing the contract.
Not one or the other the appealing party nor his operator had any take note that the respondent was a minor.
The respondent made a false announcement with respect to his age and is subsequently dis-entitled from looking for any help.
The respondent is halted by area 115 of the Indian Prove Act, 1872 from claiming that he was a minor at the time of executing the contract.
The respondent must reimburse the sum progressed concurring to segment 64 and 38 of Indian Contract Act (1872) and segment 41 of Particular Help Act (1877).
Contention of the respondent-
Brahmo Dutta and his operators Kedar Nath had information of the respondent’s real age.Since the respondent was a minor at the time of making or executing the contract, thus the contract is void i.e. it is not enforceable in the eyes of law.
Disputes
The dependence was set primarily on segment 64 of The Indian Contract Act, 1872, and area 41 (segment 33 of 1963 act) of the Particular Alleviation Act. It was fought that segment 64 of the act is established on the guideline of compensation. It states “When a individual at whose choice a contract is voidable rescinds it, the other party thereto require not perform any guarantee in that contained in which he is the promisor. The party cancelling a voidable contract should, on the off chance that he had gotten any advantage thereunder from another party to such contract, reestablish such advantage, so distant as may be, to the individual from whom it was received” subsequently making Dharmodas Ghose obligated for reimbursement of the sum as of now gotten in reference to the contract deed. Furthermore, it should be noted that Section 41 (previously Section 33 of the 1963 Act) of the Specific Relief Act, 1963 stipulates that in the event an agreement is deemed void due to the factor of incompetency under Section 11 of the Contract Act, the court may mandate the party to reimburse the rightful owner for any benefits received. This section also highlights the responsibility of Dharmodas Ghose to make repayment.
Ratio Decidendi
The Court took liberty in interpreting the various provisions and analysed Section 4 of the Transfer of Property Act, 1882 which stated that every provision of the Act relating to contracts has to be read in accordance with the Contracts Act of the Indians, 1872, which then led to Section 7 of the Transfer of Property Act which provides that any person competent to contract may transfer his property in the prescribed manner.
To consider the concept of jurisdiction, the courts have turned to Section 11 of the Indian Contract Act, 1872, which considers a minor as incompetent to contract. Therefore, give any contract signed by a small margin. And forcing a person to pay according to an agreement is declared by the law itself to be contrary to the principle of equity.
Judgement
Upon careful examination of several pertinent provisions of the law, the court has arrived at the subsequent determination. In accordance with section 11 of The Indian Contract Act, 1872, individuals who are minors are deemed incapable of entering into contracts, rendering any agreement made by a minor completely null and void. Consequently, neither section 64 nor section 65 of The Indian Contract Act, 1872 can be invoked to grant relief, as both provisions explicitly require the presence of a valid agreement or contract between parties possessing legal capacity. In the present case, such a requirement is absent.
With respect to the discretion granted under section 41 (section 33 of the 1963 act) of the Specific Relief Act, 1963, both the trial court and the appellate court have already determined that, based on the circumstances of the case wherein the defendant possessed complete awareness of the plaintiff’s infancy, there exists no justifiable cause to enforce repayment and disrupt the discretion that has already been exercised.
As per the ruling of the Trial Court, the aforementioned mortgage deed or contract, which was entered into by the plaintiff and the defendant, was deemed null and void due to its execution by an individual who was a minor at the time. Subsequently, Brahmo Dutta, dissatisfied with the Trial Court’s verdict, proceeded to file an appeal in the esteemed Calcutta High Court. In accordance with the ruling of the Calcutta High Court, they concurred with the verdict of the Trial Court and dismissed Brahmo Dutta’s appeal. Subsequently, Brahmo Dutta pursued an appeal to the Privy Council, which also dismissed his appeal and determined that no contract could exist between a minor and an adult. The final decision rendered by the Council was as follows: Any contract involving a minor or infant is considered void or void ab initio (void from the beginning). Since the minor lacked the capacity to enter into such a mortgage, the contract in question is deemed void and lacks validity in the eyes of the law. Dharmodas Gosh, the minor in question, cannot be compelled to repay the advanced amount of money, as he was not bound by the promise made within the contract.
There is no estoppel against a minor. The issue of estoppel against a minor has caused legal complications among authorities. However, the responsible authority has determined that estoppel does not apply to juveniles. Estoppel refers to the principle that if a person makes a statement that misleads another person, they cannot later deny or contradict that statement as they have a duty to stand by it. The theory of estoppel prohibits a party from making statements that contradict their previous claims. Consequently, minors are not prohibited from receiving child protection. The rationale behind this is that there should be no hindrance to the legislative rule established in the statute. In the case of Mohiri Bibi, the defendant misrepresented their age in order to mortgage their house, but the money-lender was already aware that the defendant was a minor. As a result, the Privy Council did not recognize the doctrine of estoppel, as the appellant was not deceived or misled by the minor’s argument.
Conclusion:
According to The Indian Contract Act, 1872, the status of a minor is such that they are unable to enter into a contract, rendering any such agreement invalid from the outset. A minor cannot rely on the approval of a contract made during their minority in order to attain majority status. The concept of ratification is explained as applying retrospectively to the time when the individual was still a minor, thereby preventing the legitimization of an invalid contract at a later stage. In the event that a new contract is required, fresh consideration must be provided upon reaching the age of majority. Additionally, any agreement that seeks to achieve specific outcomes cannot be entered into by a minor, as it would result in an invalid arrangement. However, the minor would only be held liable for claims related to necessities. In the case of Mohiri Bibee V/S Dharmodas Ghose, it can be deduced that any agreement or contract in which a minor is a party or is included in any way shall be deemed null and void as it is not recognized as a valid agreement under the law. It is impermissible to enforce any agreement against an infant. In instances where a minor engages in transactions without the knowledge or consent of their parents or guardians, the latter shall not be held accountable for any such dealings, and therefore, they shall not be obligated to reimburse any amount taken by the minor out of moral obligations. However, parents and guardians shall be liable to repay any amount if the minor or infant acted with their consent. If a minor has derived any benefit from a void contract, they cannot be compelled to reimburse or compensate for it.
