This article is written by Shruti Sharma of 5th semester of The Law School, University Of Jammu, an intern under Legal Vidhya
ABSTRACT
A contract becomes a valid contract when all its prerequisites are satisfied. Competency of parties is one such condition. Hence, a minor cannot enter into a contract personally. In this article, we try to delve deep into two major concepts related to the minor’s contract and those concepts are- Doctrine of Restitution and the liability of minor’s estate for the necessaries supplied to the minor. These two concepts have a great value under the minor’s contract. They aim at safeguarding the rights of the other party in a minor’s agreement.
KEYWORDS
Minor, restitution, contract, liability, necessaries
INTRODUCTION
In India, the practice of entering into contracts for various purposes has been prevalent since time immemorial. However, the concept of contracts was finally recognized formally under the law in the year 1872 with enactment of the Indian Contract Act, 1872[1]. This act has provisions governing the various concepts related to contracts. The act explains about contracts and also explains the conditions when a contract becomes a void contract or when such contracts cannot be enforced legally. One such contract that cannot be enforced under the law is an agreement entered into by a minor. An agreement entered into by a minor is considered to void-ab-initio which means that such a contract is considered to be void from the very initial stage and this is provided to protect the minor from the unwanted consequences of a contract. However, this doesn’t mean that a minor has no liabilities in case of an agreement that he has entered in his minor capacity. The doctrine of restitution and the liability for the necessaries supplied to him are two such cases where the minor has some level of liability towards the other party of the contract. These two liabilities act as some kind of compensation for the other party that has incurred loss due to such agreement.
Who is a minor?
The Indian Contract Act, 1872 has a mention about minor and his position in a contract, but it fails to explain about ‘who is a minor’. The section 11 of this act provides that a person who has not attained the age of 18 years will be considered to be a minor under the law and a contract by such minor would be no contract.
Other than the Indian Contract Act, 1872 the concept has been elaborately explained in the Indian Majority Act, 1875[2]. This act explains about the age of majority and indirectly it also explains about the age of a minor. Section 3 of the act explains that a person who has attained the age of 18 years would be considered to be a major under law and in some exceptional cases, such age can be exceeded to 21 years.
Thus, through this act the minor’s age became even clearer.
DOCTRINE OF RESTITUTION
The term restitution literally means the act of returning something that has been lost or removed back to its legal owner. Under thesection 2(h) of the act of 1872, an agreement for being validly considered to be a contract, must be backed by consideration that can be in the form of cash or kind.
The Section 65 of the Indian Contract Act, 1872 deals with the doctrine of restitution. The doctrine of restitution applies to the situations where the agreement, due to some reasons, is discovered to be void or it becomes void. In such a case of void agreement, if a person has gained some advantage from the other party, then he is bound to restore it back or compensate the person from whom he has gained such an advantage. Parties to unenforceable agreements are generally entitled to recover the value of benefits conferred on the other party in performance of what were thought to be binding contractual obligations.
Restitution in a Minor’s Agreement
This doctrine of restitution also applies to a minor’s agreements. As per this rule, in case a minor acquires any item through misrepresentation of his age then he is bound to pay it back, but only if it is traceable. Simply said, a minor’s contract is typically voidable at their discretion. This essentially releases the kid from any duties resulting from the contract by giving them the option to enforce it or invalidate it. Any payment made under the terms of the agreement must be returned by the minor if they choose to cancel it. For example, if a minor purchases thing, they have to pay the seller for the products’ worth or return the goods to the seller. In the context of a minor’s agreement, this doctrine basically revolves around fairness and justice. This is so provided because a minor can never be allowed to cheat under the assumption him being in his childhood. In the context of minor’s agreements, it makes obvious sense to allow for at least partial recovery based on the theory of unjust enrichment.
Rationale behind this rule
The reason behind the doctrine of restitution being applied to minor’s agreement is very simple. The legal system recognizes that because of their youth and immaturity, adolescents do not have the full capacity to comprehend the consequences of their conduct. As such, it would be unjust to hold them solely accountable for their breach of contract or tortuous behavior. However, minors cannot be allowed to take unlimited advantage of this concept. Therefore, the law provides for the reimbursement of the traceable property by the minor to the other party to the contract in case of a void contract. Additionally, it permits the minor to learn from his mistakes without facing any long-term repercussions.
The concept of restitution in a minor’s agreement has been reiterated in various case laws. Some of the landmark judgments related to the doctrine of restitution in a minor’s agreement are as follows:
Mohori Bibee V. Dharmodas Ghosh (2003)[3]
This landmark decision brought to light the requirement of repayment in agreements involving minors. In circumstances where contracts are void ab initio because of incompetent parties, the court stressed the significance of returning parties to their pre-contractual positions.
Thus, in this case, the Privy Council was of the view that the doctrine of restitution also applies in case of a minor’s agreement.
Khan Gul V. Lakha Singh (1928)[4]
One of the seminal rulings in the area of minors is Khan Gul V. Lakha Singh. The decision is significant in a number of ways and altered the dynamics surrounding the amount of compensation that minors must provide.
In this case, a minor entered into a contract to sell a plot of land by falsely representing his age. Despite being paid Rs. 17,500, he declined to carry out his end of the arrangement. However, the youngster was required to return the consideration in accordance with the case’s final verdict. The Restitution concept was applied here.
Thus, it is very clear that the doctrine of restitution has been correctly applied in the case of a minor’s agreement and in really serves its purpose. We can say that in situations where kids are involved, the Doctrine of Restitution acts as an essential safeguard to uphold their rights and advance justice in the legal system. It gives minor a way to grow from their mistakes without having to deal with impossible repercussions.
However, there is again one exception to this rule being applied to minor’s agreement. According to it, in case the commodity or the property is impossible to be traced or located then in such a situation the Doctrine of Restitution would not apply. This means that this doctrine can only applied upon the traceable goods.
LIABILITY FOR THE NECESSARIES SUPPLIED
The Indian Contract Act, 1872 has certain provisions which actually deal with the beneficial contracts and one such is the creation of liability on the property of the minor in case any necessary has been supplied to him by the other party. As per this provision, if a minor or any other person who is incompetent under law or any other person whom he is bound to support under the law, is supplied by some other person with necessaries, then the person who has provided such supplies will be entitled to some kind of reimbursement. The section 68 of the Indian Contract Act, 1872 has the provision for this issue. One thing that has to be kept in mind is that the rule doesn’t create liability against the minor rather it is the property of such minor which has to face the liability.
This position was clearly demonstrated in the decision of the Privy Council in Mohori Bibee V. Dharmodas Ghosh where the council stated that the act makes it clear that the minor must not be considered liable even in case of necessaries supplied to him, and thus, no demand is to be made in this respect and whatever liability exists, it exists against the property of the minor. Thus the one who is considered to be the supplier under the law can claim the reimbursement only out of the property of the benefitted minor.
What are Necessaries?
A very important matter of concern is that what all can be considered to be necessary. First of all, ‘necessities’ refers to items such as food, clothing, and housing that a person cannot logically exist without. It also encompasses all that a minor in that class of could legitimately be regarded necessary. As a result, it must be decided in light of the specific minor’s circumstances and luck. For this reason, ‘necessities’ refers to items that are appropriate for the minor’s living situation and genuine needs at the time of the sale and delivery.
Necessities aren’t just food and clothing. Instruction in trade or the arts, or intellectual, moral, and religious education, may also be required, since the right nurturing of the mind is as beneficial as the support of the body. Thus, these can also be considered to be necessities under some circumstances. Furthermore, a person’s standing and needs at the time of actual delivery of goods may determine what qualifies as “necessities”.
Contracts that a minor enters into for trading purposes are not necessary and are not binding on him when he trades. It should be mentioned that the necessities could be given to his wife and kids, or to anybody else the minor is legally required to maintain. Even if the minor advances into a high society, ornamental items like diamonds are typically not seen as necessities unless they are particularly required for the minor.
Minor’s liability
Since the minor’s agreement is void from the beginning, he usually cannot be made to pay for the products or services that are provided to him.
However, Section 68 of the act allows payment to be made to an individual who provides ‘necessaries’ to a mentally ill or minor. This need to reimburse is recognized by law as “quasi-contractual” obligation rather than existing as a result of legitimate contract with the minor, etc.
Two requirements must be satisfied for the minor’s estate to be held accountable:
* The contract must be items that are reasonably essential for the minor’s support in accordance with their station in life.
* The minor must not already possess an adequate amount of these requirements.
According to Section 68, reimbursement is allowed if:
1. Necessities are provided;
2. To an incapable person (such as a minor or a lunatic);
3. to a dependent person (such as the spouse or the children of an incapable person) who is obligated by law to provide for the incapable person;
4. Appropriate to that person’s circumstances.
The consent of the minor is not a prerequisite for the minor’s responsibility in India. This is due to its quasi-contractual nature, which means that the minor’s estate bears all responsibility. The actual basis is a legal requirement that the child provide a just compensation for requirements met. There is also the opinion that the liability is contractual. A contract for necessities is simply one of the types of agreements that a kid might enter into.
Therefore, it is evident from the above-mentioned discussion that in case of necessaries supplied to the minor, the law has certain provisions for the reimbursement of the supplying party. Even if the minor is not held liable personally, the property of such a minor is held liable for providing some sort of compensation. However, if the minor doesn’t hold a property in his name, then there aren’t many options with the supplier.
CONCLUSION
To conclude this article, we can say that in situations when kids are involved, the Doctrine of Restitution acts as an essential safeguard to uphold their rights and advance justice in the legal system by providing a chance for the other party to be compensated in case of any advantage that has been taken by the minor in the due process of that contract. The Doctrine of Restitution creates a legal responsibility on the minor to restore back to the other party any advantage that has been gained by the minor. Not just the Doctrine of Restitution, the liability of the minor’s estate to reimburse the supplier of the necessaries to the minor is another provision that provides the opposite party with a safeguard to some extent when entering into a contract with the minor or when providing the minor with the necessaries as mentioned above. So, it is clear that the agreement entered into by the minor doesn’t have any legal value as they are considered void under law, however, the law has a few provisions safeguarding the rights of the opposite parties in a minor’s agreement.
REFERENCES
1. Dr. R.K Bangia’s Contract-2 (Allahabad Law Agency, Faridabad, 8th edition, 2022)
2. Avatar Singh’s Contract and Specific Relief (Eastern Book Company, Lucknow, 6yh edition, 2016.
3. ipleaders- https://blog.ipleaders.in/what-is-the-doctrine-of-restitution/
[1] Indian Contract Act, 1872, Act 9, 1872.
[2] Indian Majority Act, 1875, Act 9, 1875.
[3] Mohori Bibee V. Dharmodas Ghosh, ILR (1903) 30 Cal 539 (Pc)
[4] Khanu Gul V. Lakha Singh, AIR 1928 Lah 609
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