Submitted to:- Compiled By:-

Tabrez Ahmad Shruti Mishra (983059)

Faculty of Contarcts Sneha (983061)

Kiit Law School B.A LL.B.Sem (1st)

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ACKNOWLEDGEMENT

This project is a group effort. We acknowledge our gratitude to our contracts faculty

Mr.Tabrez Ahmad who helped with his constructive criticism and guidance and encouraged us

on this project. We would show our immense gratitude for his guidance in selecting the material

and its proper usage.

Finally, we wish to express our gratitude to all those people whose thoughts and insights helped

us understand the subject. We would like to show our immense thankfulness to my friends

without whose help the successful completion of this module would not have been possible.

We thank you all once again.

Shruti Mishra (983059)

Sneha (983061)

B.A. LL.B. 1st semester

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INDEX

INTRODUCTION 8

PART – I INDIAN LAW 9 – 20

PART – II ENGLISH LAW 21 – 24

CONCLUSION 25

CASE LIST 26

BIBLIOGRAPHY 27

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Contract with minors is not always void:critical study

                                   

                                          (Abstract)                   

                                                                                                           -Shruti Mishra,

                                                                                                             B.A LL.B 1st Sem

                                                                                                              983059  

In this abstract the researcher is going to analyze the contracts where contracts with minors are

not void.

Section 11 of Indian Contract Act 1872 states that every person who is of the age of majority

according to the law to which he is subjected to; who is of sound mind & is not disqualified from

contracting by law are competent to contract.

     Thus minors are incompetent to contract & contract with minors are void.But there are few

exceptions to this general rule where the contracts entered into with minors are enforceable.

Contracts with minors are binding if the contract is made for the benefit of the minor. Some

examples of contracts which are binding on the minor are as follows-:

*Minors are liable for the supply of the ‘necessaries’ of life made to them by any person. i.e. the

person who has supplied the ‘necessaries’ of life to the minor is entitled to reimbursement from

the minor’s guardian or property.

a.A minor is liable to repay the loan borrowed to pay a debt for ‘necessaries’ of life.

b.Contracts made with a minor for their employment or training are enforceable provided they

are beneficial for the minor.

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c.There are also few contracts which binds both the contracting parties unless the minor

repudiates. These are--:

    #.Contracts relating to an interest in land.

     #.Contracts relating to marriage settlements.

     #.Contracts relating to the purchase of or subscription for shares.

     #.Contracts relating to partnerships. 

       Minors are held incompetent to contract by law as they are immature and may not be able to

understand the consequences of the terms & conditions of the contract and may land themselves

into great trouble in the future.But anyhow law had made certain contracts enforceable which

are made for the benefit of the minor which promotes the welfare of the minors by co-operation

& help in the society or otherwise no one would ever come forward to look after or help the

minors. 

 

Key words:

Void

Incompetent

binding

Beneficial

necessaries

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Contract with Minor Is Not Always Void: Critical study

                                      By: - Sneha B.A LL.B. Roll no.983061  

ABSTRACT 

 

 In this abstract the researcher is going to analyze the contract where contract with minors are

void.  

Section 11 of the Indian Contract Act, 1872 states, every person is competent to contract who’s

the age of majority according to the law which’s subject, & who’s of sound mind & is not

disqualified from contracting by any law to which he’s subject. 

The law regarding minor’s agreement:-

1)  An agreement by a minor’s absolutely void & inoperative as against him.

2)  Ratification of acts done on minor’s behalf.

 Minor can neither himself enter into contract nor authorized an agent to do so on                    

his behalf.                                                                                                       

3)  Minor’s liability for necessaries.

Minor if supplied by another person with necessaries suited to his life, the person who has

furnished supplies’ entitled to be reimbursed from the property of the minor but the minor

himself isn’t liable to the supplier.

4)  Minor as a partner & shareholder.

A minor being incompetent to contract can’t be a partner in a partnership firm, but he can

admitted to the ‘benefits of partnership’ with the consent of all the partners by an agreement

executed through his lawful guardian. He can’t be a shareholder of the company. 

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Minors are permitted to enter into contracts for limited purposes, and the test is one that focuses

on the nature of the transaction, and whether the minor is of an age such that they capable of

understanding it.

Thus Law acts as the Guardian of Minors & protects their rights, because their mental faculties

are immature. They don’t possess the capacity to judge what’s good & what’s bad for them.

Contracts which are made for the benefit of the minor help them in their day to day life. 

Keywords: - minor, competent, inoperative, ratification, necessaries, reimbursed, guardian.

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CONTRACT WITH MINORS IS NOT ALWAYS VOID:

CRITICAL STUDY

BY-Shruti Mishra(983059)

Sneha(983061)

B.A. LL.B., 1st Semester

Introduction Section 10 of the Indian Contract Act 1872 requires that the parties must be competent to contract and section 11 defines competence to contract. Every person is competent to contract who is of the age of majority according to the law to which he is subject, and who is of sound mind, and is not disqualified from contracting by any law to which he is subject. Thus, Minors are not competent to contract and the age of Majority is 18yrs according to Sec. 3 of the Indian Majority Act, 1875.

According to Indian Contract Act 1872, a Minor is incompetent to contract but the status of the agreement made with a minor was not clear until 1903 when Privy Council in their well-known pronouncement in Mohoribibi v Dharmodas Ghose stated that all contracts made with minors will be considered void. But in its subsequent pronouncement in Subramanyam v Subba Rao AIR 1948 PC 25 the Privy council overruled earlier decisions and entertained that it was within the powers of the mother as a guardian to enter into a contract of sale for discharging his father’s debts .But this contract should be for the benefit of the minor and would be binding upon him.

Law also recognizes that it is desirable for minors that there should be some degree of binding obligation in relation to some contracts as they are appearing in public life today more frequently than even before. The Privy Council had therefore to modify its earlier decisions. In Srikakulam Subramanyam v Kurra Subba Rao (1949) 75. Lord Morton held that Sec. 11 of the Indian Contract Act 1872 and the Mohribibi case leave no doubt that a minor cannot contract and that if the guardian and the mother had taken no part in this transaction it would have been void. The contract being for the benefit of the minor and within the power of the guardian was held to be binding upon him. Some examples of a contract which are made for the benefit & are binding on the minor are as follows-:

*Minors are liable for the supply of the ‘necessaries’ of life made to them by any person. I.e. the person who has supplied the ‘necessaries’ of life to the minor is entitled to reimbursement from the minor’s guardian or property.

a. A minor is liable to repay the loan borrowed to pay a debt for ‘necessaries’ of life.

b.Contracts made with a minor for their employment or training is enforceable provided they are beneficial for the minor.

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c.There is also few contracts which bind both the contracting parties unless the minor repudiates. These are--:

    #.Contracts relating to an interest in land.

     #.Contracts relating to marriage settlements.

     #.Contracts relating to the purchase of or subscription for shares.

     #.Contracts relating to partnerships.

A minor will have the option of retiring from a contract of beneficial nature on attaining majority provided that he exercises the option within a reasonable time.

Where a minor in pursuance of a marriage settled his after acquired property and after attaining majority he received large sum of money under the will of his father which came under the settlement, and, therefore, he attempted to repudiate the settlement, The House of Lords held that the repudiation coming after 5 years after attaining majority was too late.  

There are various effects of an agreement with a minor. There is no Estoppel against minor. Minors are not liable in contract or in tort arising out of contract. In accordance to the Doctrine of Restitution, if an infant obtains property or goods by misrepresenting his age, he can be compelled to restore it, but only so long as the same is traceable in his possession.

THROUGH analytical study of Indian & English law, it has been tried to find out the actual status of the contracts with the minors. The researches have tried to ascertain the conditions where a minor’s contract is enforceable or void. whether under certain circumstances minors could be under obligation or not or could be held liable or not .

After all possible study and research it can be ascertained that although a contract with a minor is void but in cases where the contract made is for the benefit of the minor is enforceable in Law and is binding on the Minor.

The complete project has been presented as follows-:

1. Part – I [Indian Law]2. Part – II [English Law]

Further, these parts are divided into headings and Sub- headings and every principle and facts related to minor’s contract has been discussed in details with reference to the relevant cases.

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Part –I

By- Shruti Mishra(983059)

INDIAN LAW

(Analytical study)

In this part various aspects & status of a contract with a minor in Indian Contract Law is

analyzed. A minor is incompetent to contract and a contract with a minor is void but under some

circumstances the contracts are enforceable and also binding upon the minor. The different

effects of minors contract are also discussed in this part.

I.1 Competency to Contract

Section 10 of the Indian contract Act 1872 that the parties must be competent to contract and

section 11 defines competence to contract.

Every person is competent to contract who is of the age of majority according to the law to

which he is subject, and who is of sound mind, and is not disqualified from contracting by any

law to which he is subject.

Thus, the section declares the following persons are not competent to contract-:

o minors,

o persons of unsound mind

o persons disqualified by law to which they are subject.

The age of Majority is 18yrs according to Sec. 3 of the Indian Majority Act, 1875.

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Sec 10 requires that the parties to a contract must be competent and sec 11 declares that a

minor is not competent but neither section makes it clear whether, whether if a minor enters

into an agreement, it would be voidable at the option or altogether void. Therefore these

provisions had quite naturally given rise to a controversy about the nature of minor’s

agreement.1

This controversy was only resolved in 1903 by the judicial committee of the Privy Council in

their well known pronouncement in Mohoribibi v Dharmodas Ghose (1903) Pc2:

The plaintiff, a minor mortgaged his houses in favour of the defendant a money lender, to

secure a loan of Rs. 20,000/-. A part of this amount was actually advanced to him. While

considering the proposed advance, the attorney, who was acting for the money-lender,

received information that the plaintiff was still a minor. Subsequently the infant commenced

this action stating that he was under age when he executed the mortgage and the same

should, therefore, be cancelled. The relief of cancellation had to be granted as the plaintiff

was entitled to it. (Under sec 39 of the original Specific relief Act 1877 courts were

authorized to order cancellation of void contracts. Now Sec. 31 of the Act of 1963). The

money lenders only request was that the relief should be made subject to the condition of the

minor’s repaying him the sum of Rs. 10,500/- advanced as a part of the consideration for the

mortgage.

Sec. 64 and sec 65 of the Indian contract act 1872 and Sec 41 of the Specific Relief Act 1877

[S. 33 of 1963] were in question.

Sir Lord North observed:

“Looking at section 11 their Lordships are satisfied that the Act makes it essential that all

contracting parties should be competent to contract and expressly provides that a person who

by a reason of infancy is competent to contract cannot make a contract within the meaning of

the act. The question whether a contract is void or voidable presupposes the existence of a

contract within the meaning of the Act, and cannot arise in the case of an infant.”1

11.Avtar Singh,Contract & Specific Relief,10th edition,pg no.1532.Mohiri Bibi V Dharmodas Ghose (1903) 30 IA 114:30 Cal 539

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Ever since this decision it has not been doubted that a minor’s Agreement is absolutely void.

In its subsequent pronouncement in Subramanyam v Subba Rao AIR 1948 PC 25. the Privy

council overruled earlier decisions and entertained no doubt that it was within the powers of

the mother of a minor as a guardian to enter into a contract of sale for the purpose of

discharging his fathers debts. Following this decision the Orissa HC, held that endowment of

property for religious purposes by guardians on behalf of minors, being within their

competence of was specifically enforceable3.The other High Courts have also expressed the

view that the doctrine of mutuality should not have been imported into the matter where the

contract was within the competence of the guardian and that there is no scope for this

doctrine under sec. 20 of the Specific Relief Act 1963.

I.1.1 Changed provisions

In todays society Minors are appearing in public life today more frequently than even before.

They have to travel, get dresses tailored, visit cinema, deal with educational institutions, and

purchase so many articles of daily life and education. If, in any of these cases, the other party to

the contract could brush aside the minor on the ground that the engagement is void, the legal

protection against contractual liability would be too dear to minors. The Privy Council had

therefore to modify its earlier decisions. This trend is evidenced by the decision of their

Lordships in Srikakulam Subramanyam v Kurra Subba Rao (1949)4 . Lord Morton held that Sec.

11 of the Indian Contract Act 1872 and the Mohribibi case leave no doubt that a minor can not

contract and that if the guardian and the mother had taken no part in this transaction it would

have been void. The contract being for the benefit of the minor and within the power of the

guardian was held to be binding upon him.

3.Durga Thakurani v Chintamani,AIR 1982 Ori1584. Srikakulam Subramanyam v Kurra Subba Rao AIR 1948 PC 25: 75 IA 115

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I.2 Beneficial Contracts

The law Minor’s contract absolutely void is generally followed but it has been growingly

confined to cases where a minor is charged with obligations against the minor.5 It was observed

by Madras High Court that what is meant by the propositions that an infant is incompetent to

contract or that his contract is void is that the law will not enforce any contractual obligation of

an infant.Accordingly,a Minor is allowed to enforce a contract which is of some benefit to him

and under which he is required to bear no obligation.

The same opinion was expressed by Beaumont CJ of the Bombay High Court:6

The provisions of the law which make a contract by a minor not binding were no doubt intended

to be for the benefit of the minors and the courts in this country when faced with a contract

which has been carried out by or on behalf of the minor, the performance of which by the other

party is then resisted on the ground of minority, have struggled hard to avoid holding the contract

wholly void to the detriment of the minor.

.

I.2.1 Some of the beneficial contracts for Minor:

Necessaries-

Contracts to provide minors with ‘necessaries’ form the main exception to the general lack of

capacity to contract. A Minor will have to pay a reasonable price for the necessaries provided to

him, if the contract is generally beneficial to him. It is for the party claiming to have contracted

with the minor to establish that the contract is a contract for necessaries. Necessaries include

goods and services. To some extent it is obvious what can be considered to constitute

necessaries: contracts to provide food, drink, clothing and education etc. are within this category.

Necessaries also vary according to the Minor’s situation in life or peculiar circumstances at the

time of the contract.2

25. Avtar Singh,Contract & Specific Relief,10th edition,pg no. 163,quoted from Raghava Chariar V Srinivasa(1916) 40 Mad 3086.Great American Insurance Co Ltd V Madanlal Sonulal(1935) 59 Bom 6567. Ansons,28th edition,pg no.128,quoted from William v Moor(1843) 11 M & W .2568. Ansons,28th edition,pg no.128

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Loan for Necessaries—

In equity it was held that if minor borrowed money to pay a debt for necessaries, and the debt

was actually paid therewith, the lender stood in the place of the person paid and was entitled to

recover the money lent. It is not possible however to sue a minor on a negotiable instrument

given for the price of necessaries, even though it may have been negotiated to a third party.7

Employment and Training Contracts:

A minor may enter into a contract of employment so as to earn a living or into a contract for the

purpose of obtaining instruction or education so as to qualify for a suitable trade or profession.

The Indian Apprentices Act, 1850 provides for contracts of service which are binding on minors.

The Act requires the contract to be made by a guardian on behalf of the minor.8

Contracts of Marriage:

A contract for the marriage of a minor is also prima facie for his or her benefit. It has, therefore,

become well- established, almost without any controversy, “that while the contract of marriage

could be enforced against the other contracting party at the instance of the minor it cannot be

enforced against the minor.”9

A minor can be an agent, but he cannot be a principal nor can he be a partner. However,

he can be admitted to the benefits of a partnership.

A minor cannot be adjudicated as an insolvent as he is never personally liable.

9. Avtar Singh,Contract & Specific Relief,10th edition, pg no.166,quoted from Kania J (1941) Bom 211,221.

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In a general sense contracts which can be brought within certain categories and are also for

the benefit of the infant can be supported.

I.2.2 Trade Contracts not included in Beneficial Contracts:

This category of beneficial contracts does not include ordinary trade contracts. In Cowern V

Nield10 ,Phillimore J observed:“In a general sense contracts which can be brought within certain

categories and are also for the benefit of the infant can be supported. A trading contract does not

come within any of these categories. The Only contracts of an infant which can be enforced are

which relate to the infant’s person, as contracts by which he provides himself with

clothes,food,or lodging or contracts of marriage, apprenticeship and service.”

o A minor will also have the option of retiring from a contract of beneficial nature on

attaining majority provided that he exercises the option within a reasonable time.

31.3 Effects Of Minor’s Agreement

310. Cowern V Nield (1911-13) All ER Rep 42511.Gadipegga Bhimappa Mets v Balangowda,AIR 1931 Bom 561.

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A minor’s agreement being void, ordinarily it should be wholly devoid of all effects. If there is

no contract, there is no contract, there should, indeed, be no contractual obligation on either side.

Consequently all the effects of a minor’s agreement must be worked out independently of any

contract.

1.3.1 No Estoppel against Minor

If a minor by misrepresenting his age induces another to contract with him, there will be no

estoppel against him. The infant is not estopped from setting up the defence of infancy. The

reason is very simple. There can be no estoppel against a statute. The policy of the law of

contract is to protect persons below age from contractual liability and naturally the doctrine of

estoppels cannot be used to defeat that policy.

Thus, in a case before the Bombay High Court11, BEAUMONT CJ reviewed the earlier

authorities and concluded by saying:

“The court is of opinion that where an infant represents fraudently or otherwise that he is of age

and thereby induces another to enter into a contract with him then in an action founded on the

contract the infant is not estopped from setting up infancy.”

The plain statutory provision that a minor is incompetent to incur a contractual debt cannot be

overruled by estoppels. The question is whether a minor , who has made a false representation as

to his age ,is estopped from pleading his minority ,was raised but not decided in Mohori Bibee’s

case .Their Lordships observed:” There can be estoppel where the truth of the matter is kopek to

the both parties, and Their Lordships hold, in accordance with English authorities, that a false

representation made to a person who knows it to be false is not such a fraud as to take away the

privilege of infancy.”

4

4 12.Leslie (R) V Sheill (1914) 3 KB 607 13.H.K.SAHARAY,Dutt on Contract,pg no.175

16

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1.3.2 Restitution

If a minor obtains property or goods by misrepresenting his age, he can be compelled to restore

it, but only so long as the same is traceable in his possession. This doctrine is known as the

equitable doctrine of restitution. If the minor has sold the goods or converted them, he cannot be

made to repay the value of the goods as this would amount to enforcing a void contract. This

doctrine of restitution is not applied where the minor has obtained cash instead of goods. The

well known authority in this principle is Leslie(R) Ltd V Sheill12:

A minor succeeded in getting £ 400 as loan from a money lender on the faith of his (minor)

being an adult. The money lender’s attempt to recover the principle and the damages for fraud

failed because of the above mentioned doctrine. The money lender failed even under the Quasi-

contracts and Doctrine of restitution. So finally they had to really on Equity to restore the money.

Rejecting the contention, Lord Sumner said: I think this would be nothing but enforcing a void

contract.

1.3.3 Powers of Guardian –

The law establishes that a minor is not competent to contract and a person who is not appointed

the guardian by any court, cannot enter into a valid contract on his behalf. Such a transaction

cannot also be upheld as a family settlement. Father and Mother is the only natural Guardian of

minors. it is beyond the power of a natural Guardian to impose personal liability on the ward by

a contract to charge the property of the ward.13A minor is also not liable on a promissory note

executed by the guardian unless there was a real necessity for it or it was for the benefit of

minor’s business’ de facto guardian of a Muhammadan minor has no power to convey the

minor’s share but that of a Hindu minor can convey it for legal necessity. A de facto guardian

cannot bind the minor by a settlement which robs the minor of a large part of his property. A

compromise by a guardian of a minor of a doubtful claim which is not in any way to the

detriment of the minor would be binding upon him. But a compromise resulting in the

5

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relinquishment of a claim of a joint family which includes minors against a person who has been

ordered to make certain payments by court is not binding on the minors if made without the

sanction of the court. A minor is not liable to pay a sum of money paid to his guardian as earnest

money in respect of a contract of sale of immovable property entered into by his guardian on his

behalf.

1.3.4 Specific performance-

The minor’s contract is void so any agreement itself is nullity, thus no question of specific

performance can arise. But if a contract be entered into behalf of a minor by one who is

competent to contract i.e. a certified gaurdian, and if the contract is for the benefit of the minor,

performance will be allowed. Where the contract is to the detriment of the minor it cannot be

specifically enforced. The Privy Council has held that a suit does not lie for Specific

performance of an arrangement entered into by the natural guardian of a minor for the sale of

immovable property to the minor during his minority. It is not within the competence of the

guardian of a minor to bind the minor by a contract for the purchase of immovable property and

the minor cannot obtain Specific performance of the contract unless it is for the minors benefit.

1.3.5 No liability in Contract or in Tort arising out of contract-

A minor’s agreement is devoid of all legal effects. In law, a minor is incapable of giving consent

and there being no consent, there could be no change in the character or status of the parties. As

early as 1665 in Johnson V Pye14 it was held that “an infant”15 who obtains a loan of money by

falsely representing his age cannot be made to repay the amount of the loan in the form of

damages for deceit.”It was also pointed out that if infants were held liable on their contracts by

means of action in tort. Hence a minor cannot be held liable for anything which would be an

indirect way of enforcing his agreement. 6

This principle has been generally followed in India. In Hari mohan V Dulu Miya (1934)16, the

Calcutta High Court refused to hold a minor liable in tort for money lent on bond.

615. 14 .Johnson V pye (1665) 1 sid 258: 82 ER 1091Formerly Minor was Refered to as an “Infant”,It was changed by Family Law Reform Act , 1969

18

But where the Tort is independent is of contract, the mere fact that a contract is also involved,

will not absolve the minor from liability. Thus in a case, where a minor borrowed a mare for

riding only, he was held liable when he lent her to one of his friends who jumped and killed her.

1.4 Ratification

A person cannot on attaining majority ratify an agreement made by him during his minority.17

Ratification relates back to the date of the making of the contract and therefore a contract which

was then void cannot be made valid by subsequent ratification. “It would be a contradiction in

terms to say that a void contract can be ratified. If it is necessary, a fresh contract should be made

on attaining majority. And a new contract will also require a fresh consideration. “The

consideration which passed under the earlier contract cannot be implied into the contract into

which the minor enters on attaining majority.”In a case before the Full Bench of the Allahabad

High Court the facts were:18

A minor borrowed a sum of money, executing a simple bond for it, and after attaining majority

executed a second bond in respect of the original loan plus interest. It was held by a majority of

two as against one that the suit upon the second bond was not maintainable, as that bond was

without consideration and did not come under Sec 25(2) of the Contract Act. SULAIMAN CJ

said:”Section 25,sub-clause(2),applies when there is a promise to compensate wholly or in part a

person who has already voluntarily done something for the promisor.The word ‘compensate’ has

been used advisedly and does not connote the same idea as a loan. The word ‘voluntarily’ also

indicates to my mind that something has been done without any promise of compensation…..

7

716. Hari mohan V Dulu Miya,(1934) 61 Cal 107517. Avtar Singh,Contract & Specific Relief,10th edition, pg no.16818.Suraj Narayan v Sukhu Ahir, (1928) 51 ALL 164

19

Similarly the expression ‘done something for’ does not mean ‘advance money to another

person’. Doing something for a person is not paying money to him.”

Where, however, a person, after attaining majority has not only ratified but also paid the debt

incurred by him during minority, he cannot afterwards recover it back. In the view of the

Allahabad High Court such as a debt is only void and not lawful.

Conclusion ---:

Thus it is found that in Indian Contract law, minors are incompetent to contract and are protected

by law from every kind of contracts which create a binding obligation on the minors. Although

in few special circumstances where the contract is made for the benefit of the minor are binding

on them. Natural guardian or certified guardian of the minors can enter into contracts on behalf

of the minor for minor’s benefit and these contracts are binding on the minors.

PART – II

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Sneha (983061)

English Law

II.18Capacity in English law refers to the ability of a contracting party to enter into legally binding relations. If a party does not have the capacity to do so, then subsequent contracts may be invalid; however, in the interests of certainty, there is a prima facie presumption that both parties hold the capacity to contract. Those who contract without a full knowledge of the relevant subject matter, or those who are illiterate or unfamiliar with the English language, will not often be released from their bargains.

The general principle is that a contract made by a minor with an adult is binding on the adult but not on the minor. If, after attaining his majority, he ratifies it by an act confirming the promise he made when a minor, he is bound. There need be no consideration for the act of ratification. A contract by a minor is not void and any money or property transferred by him under the contract can be recovered only if there has been a total failure of consideration.

It is recognized however that minors,, may need to be able to create binding agreements, when acquiring essential items for living, or for employment.19 Thus, contracts for necessaries (goods or services deemed necessary for ordinary living) will always be legally binding. Equally, minors have the capacity to enter into contracts for employment, when the terms of such an agreement are of general benefit to them.20

II.2 Minors

In English contract law, a minor is any individual under the age of 18 years old; historically, the age had been 21, until the Family Law Reform Act 1969.21 “a minor is a person under the age of eighteen years”. Formerly minor was referred to as an “infant”, but this Act has changed the term to “minor”. As a general rule, a minor is not bound by contracts he makes, though the adult party whom he contracts with is. Once a minor reaches the age of majority however, he can elect to ratify a contract made as a minor in full capacity.22 This rule is subject to several types of contracts which a minor will be bound by, and his right to repudiate such contracts.

II.3 Contracts for necessaries

819. KLS Library copy on Law of contracts,Koffman, Macdonald, p. 46620.Furmston, Cheshire, Simpson, Fifoot, p. 55321. KLS Library copy on Law of contracts,Koffman, Macdonald, p. 46622 KLS Library copy on Law of contracts, Koffman, Macdonald, p. 466

21

Minors are legally bound where a contract supplies them with necessaries; goods or services which are deemed necessary or beneficial to them. This obligation is codified in the Sale of Goods Act 1979, in section 3, where it is stated:

Where necessaries are sold and delivered to a minor ... he must pay a reasonable price for them.

Whilst the onus of proof that a contract is for necessaries falls upon the supplier, contracts in this form have been found in a wide range of situations, including expensive and far reaching purchases. The definition of necessaries includes obvious purchases, such as food and clothing, but also services or goods which are in furtherance of education or apprenticeship. The necessaries of one minor will not necessarily reflect those of another; the particular circumstances, such as age and immediate needs, may lead to differing outcomes. For example, in Peters v Fleming, 23 it was found that a gold ring and were necessaries, for the 9child of a Member of Parliament. However, a contract may not be for necessaries where a minor's needs are adequately satisfied, or a purchase can be seen as unnecessary. This is demonstrated by Nash v Inman24 where a tailor's claim that a child's purchase of 11 waistcoats was for necessaries failed, on the grounds that he already owned adequate clothing.

It is recognized however that minors,, may need to be able to create binding agreements, when acquiring essential items for living, or for employment. Thus, contracts for necessaries (goods or services deemed necessary for ordinary living) will always be legally binding. Equally, minors have the capacity to enter into contracts for employment, when the terms of such an agreement are of general benefit to them.25

Necessaries" are those things without which a person cannot reasonably exist and include food, clothing, lodging, education or training in a trade and essential services. The "condition of life" of the minor means his social status and his wealth. What is regarded as necessary for the minor residing in a stately home may be unnecessary for the resident of a council flat. Whatever the minor's status, the goods must be suitable to his actual requirements

Although it is clear that contracts for necessaries can legally bind minors, the terms of such a contract may defeat it. Where a contract contains particularly burdensome or unfair terms, the courts may decide that a minor does not have the capacity to be bound by them.26Where a minor hired a car and crashed it through no fault of his own, the owner could not recover on the grounds that a contract term put the car entirely at the minor's risk.27

II.4 Contracts for employment

923. Peters v Fleming 151 ER 31424.Nash v Inman (1902) 2 KB 125.Furmston, Cheshire, Simpson, Fifoot, p. 55026.Furmston, Cheshire, Simpson, Fifoot, p. 55027.Furmston, Cheshire, Simpson, Fifoot, p. 550

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A minor may enter into a contract for employment, and be bound by it, where it is for his general benefit. Where an infant chose to work under terms which would lower any compensation he may have received for injury, and this was obviously to his disadvantage, he would not be bound by employment. If such terms were held to be generally to his advantage, as he would be insured against more types of accidents, his employment contract would be binding.28Equally, where a professional boxer – whilst still an infant – was deprived of pay for a fight (totalling £3,000) for breach of standard boxing rules, such sanctions were enforceable, as the necessity of upholding sporting rules was generally beneficial to him. Where this is not the case, as in De Francesco v Branu,29 contractual obligations may be void. Here, a girl of 14 contracted with a professional dancer, to become their apprentice. The contract stated that the girl could not accept dancing engagements for her, and was not required to be paid except for performances she gave. Their agreement was held not to be binding, due to this unreasonable terms.30

II.5 Repudiation

Where a minor contracts for the purchase or lease of land, or for a service which carries with it ongoing obligations (such as marriage settlements, or the purchase of shares), such a contract will be binding upon the minor upon reaching the age of majority, should they not choose to repudiate it within a reasonable amount of time.31 The amount of time which is deemed reasonable is circumstantial, though it is clear from Carnell v Harrison 32that not knowing of the right to repudiation is not sufficient to invalidate a contract. Financial obligations which fall before repudiation are binding on minors.33 A minor in an agreement to rent a flat may be sued for non-payment of rent 34,additionally, in Steinberg v Scala Ltd 35the recovery of payments made in a share agreement were denied, only future obligations were extinguished by repudiation.36

II.5.1 Ratification10

According to English law the only contracts which are absolutely binding on a minor are contracts for necessaries. Since the word “necessaries” is not defined, there are differences of opinion. In one class of cases it is confined to necessary goods and services supplied to the minor. In other class of cases it extends to contracts for the minor’s benefit and in particular to contracts of apprenticeship, education and service. But it is doubtful whether any practical importance still attaches to the distinction, although it is convenient to retain it purely for purposes of exposition.

II. 6 Estoppel

1028. Furmston, Cheshire, Simpson, Fifoot, p. 55429. De Francesco v Branum (1890) 45 Ch D 43030. KLS Library copy on Law of contracts ,Koffman, Macdonald, p. 470 31. KLS Library copy on Law of contracts ,Koffman, Macdonald, p. 47032.Carnell v Harrison [1916] 1 Ch 32833. KLS Library copy on Law of contracts, Koffman, Macdonald, p. 47134. Furmston, Cheshire, Simpson, Fifoot, p. 55435. Steinberg v Scala Ltd (1923) 2 Ch D 45236. KLS Library copy on Law of contracts, Koffman, Macdonald, p. 471

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In English law an infant who has made a false representation as to his age is not stopped from proving the true fact which, if such an estoppels were permitted, would deprive the infant of the protection necessary for his security. The proposition that there can never be estoppels against an infant is perhaps too broadly formulated and requires qualification in case of fraud. As a general rule, however, the doctrine of estoppel is not an ordinarily applicable to infant .He cannot also be estoppel by the acts or admissions of other persons. The law declares a minor’s contract to be void, he cannot be made liable by virtue of an estoppel cannot alter the law. A minor, therefore, who, falsely representing himself to be of age, enters into a contract, is not stopped from setting up the minority. A suit consequently does not lie for the recovery of money paid to him relying on such representation.

II. 7 RESTITUTION

In English law the principle has been thus laid down : “ A court of equity cannot say that it is equitable to compel a person to pay any money in respect of a transaction which as against that person, the legislature has declared to be void. This has been explained to mean that in the absence of fraud an infant is not stopped from pleading minority in answer to a suit for the return of the money advanced to him during minority. Where a minor has obtained money by misrepresenting his age, that amounts to fraud and he may be made to refund it , but it is now settled that, in the absence of fraud, he cannot be ordered to do so. So also where a minor representing himself to be of age collected rents and gave receipts, he was held stopped by his conduct from recovering again the money once paid to him by instituting a suit through his guardian.

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Conclusion

The analytical study showed that in Law, Contract with a minor is void but in circumstances

where a contract entered into by a Minor or by his Natural or Certified guardian is enforceable

and binding if it is for the benefit of the Minor. Thus, in Contracts, the Law protects the Minor

from almost all kinds of unjust obligations but also gives him enough freedom to enter into

contracts which are for his benefit and thus will help him to facilitate his life; to grow and

prosper in future.

The following points are recommended to make the Law less ambiguous & more beneficial for

the Minors-:

An exception is made to the general requirement of registration of instruments creating a lease,

in respect of leases created by the de facto guardian and for the minor’s benefit.

Contracts of services beneficial to the minor are protected even if entered into by the guardian on

his behalf.

Contracts of service entered into by the minor himself are made enforceable by him if beneficial

to him.

In the socio economic condition of the present society if a minor enters into a contract of service

to stand as a respectable self supporting person the law should help rather than obstruct him to

eke out his living. The problem of an orphan minor in destitute circumstances would be rather

acute and his laudable effort to maintain himself by a contract of service or apprenticeship

should find support from law and the party which seeks to deter from such contract on the sole

ground of minority should be compelled by law to pay damages to the minor for breach of such

contract.

Contracts of service and marriage are treated as contracts of necessaries in order to give benefit

to the minor.

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Case List

1. Cowern V Nield (1911-13) All ER Rep 425

2. Durga Thakurani v Chintamani,AIR 1982 Ori1583. Gadipegga Bhimappa Mets v Balangowda,AIR 1931 Bom 561.4. Great American Insurance Co Ltd V Madanlal Sonulal(1935) 59 Bom

6565. Hari mohan V Dulu Miya,(1934) 61 Cal 1075 6. Johnson V pye (1665) 1 sid 258: 82 ER 10917. Leslie (R) V Sheill (1914) 3 KB 6078. Mohiri Bibi V Dharmodas Ghose (1903) 30 IA 114:30 Cal 539

9. Srikakulam Subramanyam v Kurra Subba Rao AIR 1948 PC 25: 75 IA 115

10. Suraj Narayan v Sukhu Ahir, (1928) 51 ALL 16411. William v Moor(1843) 11 M & W .25612. Peters v Fleming 151 ER 314

13. Nash v Inman (1902) 2 KB 114. De Francesco v Branum (1890) 45 Ch D 43015. Carnell v Harrison [1916] 1 Ch 32816. Steinberg v Scala Ltd (1923) 2 Ch D 452

Bibliography

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BOOKS:-

Beatson J., Anson’s Law of contract,28th edition(2002). Oxford University Press. Furmston, M. P.; Cheshire, Geoffrey; Simpson, Alfred; Fifoot, Cecil (2006). Cheshire,

Fifoot and Furmston's Law of Contract. Oxford University Press. Koffman.Elizabeth Macdonald,published by tolley,4th edition 2001 Rao V Kesava, Contracts I Cases and materials ,Lexis Nexis Butterworths. 2004 Saharay H.K,Dutt on Contract the Indian Contract Act 1872,tenth edition(2006) Eastern

Law House. Singh Avtar, Contract and Specific Relief. Tenth edition(2006) Eastern Book Company

Internet:-

www.slideshare.net/tabrezahmad ( visited on 8.08.09 at 12.25 p.m)

www.wikipedia.org/wiki/capacity-in-English.law (visited on 9.10.09 at 7.55 p.m)

http://www.lawteacher.net/contract-law/lecture-notes/capacity- lecture.php ( visited on 10.10.09 at 5.38 p.m)

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