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Free Consent Under The Indian Contract Act, 1872

The document discusses the Indian Contract Act of 1872 and key concepts related to free consent such as coercion, undue influence, fraud, misrepresentation, and mistake. It defines these terms and examines their effects on the validity of contracts under the Act.

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142 views18 pages

Free Consent Under The Indian Contract Act, 1872

The document discusses the Indian Contract Act of 1872 and key concepts related to free consent such as coercion, undue influence, fraud, misrepresentation, and mistake. It defines these terms and examines their effects on the validity of contracts under the Act.

Uploaded by

theashu022
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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The Indian Contract Act

1872
Free Consent
By- Ayush Kumar
Dabur
Bcom 1
Roll no.- 2129/23
INDEX
Sr.n Particulars Slide
.
o. no
1. Definition of consent

2. Coercion (Section 15)

3. Undue Influence (Section 16)

4. Fraud (Section 17)

5. Misrepresentation (Section 18)

6, Mistake

7. Effects of Mistake
DEFINITION OF CONSENT
“two or more persons are said to consent when
they agree upon the same thing in the same
sense.”
Definition of ‘Free Consent’ (Section 14)
Consent is said to be free when it is not caused by:
1, Coercion, as defined in Section 15; or
2. Undue Influence, as defined in Section 16; or
3. Fraud, as defined in Section 17; or
4. Misrepresentation, as defined in Section 18 or
5. Mistake, subject to the provisions of Sections
20, 21, and 22.
COERCION (SECTION 15)
“Coercion’ is the committing, or
threatening to commit, any act
forbidden by the Indian Penal Code
or the unlawful detaining, or
threatening to detain any property,
to the prejudice of any person
whatever, with the intention of
causing any person to enter into an
agreement.”
EFFECTS OF COERCION
Contract induced by coercion is voidable at the
option of the party whose consent was so
obtained.
As to the consequences of the rescission of
voidable contract, the party rescinding a void
contract should, if he has received any benefit,
thereunder from the other party to the contract,
restore such benefit so far as may be applicable,
to the person from whom it was received.
A person to whom money has been paid or
anything delivered under coercion must repay or
return it.
UNDUE INFLUENCE (SECTION 16)
According to section 16 of the Indian
Contract Act, 1872, “A contract is
said to be induced by ‘undue
influence’ where the relations
subsisting between the parties are
such that one of the parties is in a
position to dominate the will of the
other and he uses that position to
obtain an unfair advantage over the
other”.
THE ESSENTIAL INGREDIENTS UNDER THIS
PROVISION ARE:

Relation between the parties


Position to dominate the will:-
1. Real and apparent authority
2. Fiduciary relationship
3. Mental distress
4. Unconscionable bargains
The object must be to take undue advantage
Burden of proof
POWER TO SET ASIDE CONTRACT INDUCED
BY UNDUE INFLUENCE

When consent to an agreement is caused by


undue influence, the agreement is a contract
voidable at the option of the party whose consent
was so caused.
Any such contract may be set aside either
absolutely or, if the party who was entitled to
avoid it has received any benefit thereunder,
upon such terms and conditions as to the Court
may seem just.
FRAUD (SECTION 17)
‘Fraud’ means and includes any of the following
acts committed by aparty to a contract, or with
his connivance, or by his agent, with an intent
to deceive another party thereto or his agent, or
to induce him to enter into the contract.
Mere silence as to facts likely to affect the
willingness of a person to enter into a contract
is not fraud, unless the circumstances of the
case are such that, regard being had to them, it
is the duty of the person keeping silence to
speak, or unless his silence is, in itself,
equivalent to speech.
The suggestion, as a fact, of that which is not
true, by one who does not believe it to be true;
The active concealment of a fact by one having
knowledge or belief of the fact;
A promise made without any intention of
performing it;
Any other act fitted to deceive;
Any such act or omission as the law specially
declares to be fraudulent.
EFFECT OF FRAUD
When the consent to an agreement in caused by
the fraud, the contract is voidable at option of the
party defrauded and he has the following
remedies:
He can rescind the contract within a reasonable
time.
He can sue for damages.
He can insist on the performance of the contract
on the condition that he shall be put in the
position in which he would have been had the
representation made been true.
MISREPRESENTATION (SECTION 18)
Misrepresentation means and includes –
The positive assertion, in a manner not warranted by
the information of the person making it, of that which
is not true, though he believes it to be true;
Any breach of duty which, without an intent to
deceive, gains an advantage to the person committing
it, or any one claiming under him; by misleading
another to his prejudice or to the prejudice of any one
claiming under him;
Causing, however, innocently, a party to an
agreement to make a mistake as to the substance of
the thing which is the subject of the agreement.
MISTAKE
Mistake may be defined as innocent or
erroneous belief which leads the party to
misunderstand the others. Mistake may
be either Bilateral or Unilateral.
Bilateral mistake is when both the parties
to a contract are under a mistake.
Unilateral mistake is when only one party
to the contract is under a mistake.
EFFECT OF MISTAKE ON VALIDITY OF A
CONTRACT

Mistake is some unintentional act, omission or


error, arising from unconsciousness, ignorance or
forgetfulness, imposition or misplaced confidence.
It is essential for the creation of a contract that
both the parties should agree to the same thing
in the same sense. Thus, if two persons enter into
a contract, each of them thinking about a
different subject matter, no contract will arise. As
a result, a mistake may lead a contract towards
voidness.
Mistake of Law: A mistake of law does not
render a contract void as one cannot take excuse
of ignorance of the law of his own country. But if
the mistake of law is caused through the
inducement of another, the contract may be
avoided. Mistake of foreign law is excusable and
is treated like a mistake of fact. Contract may be
avoided on such mistake.

Mistake of fact: Where the contracting parties


misunderstood each other and are at cross
purposes, there is a bilateral or mutual mistake.
Where both the parties to an agreement are
under a mistake as to a matter of fact essential to
the agreement, the agreement is void.

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