THE NATIONAL LAW INSTITUTE

UNIVERSITY , BHOPAL synopsis

Law of Contract-I

SYNOPSIS

CAPACITY TO CONTRACT

SUBMITTED BY- SUBMITTED TO-

RITIK KUMAR RATH NEHA SHARMA

BA.LLB HONOURS

ROLL NO-2018 BALLB 74

INTRODUCTION:-
The term “contract ” is defined in section 2(h) of the indian contract act , 1872 as follow “ An
agreement enforceable by law is a contract”

The contract has mainly 4 thing

1-There must be a consideration.

2-There must be lawful object

3- capacity to contract

4- Free consent

And in this project we will deal with capacity to contract . Section 10 of the contract act require that
the parties must be competent to contract .Competence to contract is defined in section 11:

“Every person is competent to contract who is of the age of majority according to 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 declare the following person to be incompetent to contract -

1- minors

2- persons of unsound mind

3- Persons disqualified by law to which they are subject .

Minor- The age of majority is generally 18 , except when a guardian of a minor’s person or
property has been appointed by the court , in which case it is 21 .The age of majority of a person is
to be determined “ According to the law to which he is subject “

In england the age of majority formerly was 21 years .But now under the family law reform act
1969 , “ a minor is a person under the age of eighteen years” Formerly a minor was referred to as an
“ infant “ , but this act has changed the term to “minor”

Persons of unsound mind-when a person enters into a contract and afterwards alleges that he was
so insane at the time that he did not know what he was doing , and proves the allegetion , the
contract is as binding on him in every respect , whether it is executory or executed , as if he had
been sane when he made it, unless he can prove that the person with whom he contracted knew him
to be so insane as not to be capable of understanding what it was about”

Statement of problem- The main issue is complexity of minor and lunatic person contract and how
Indian contract act is unable to deal with it .

Objective of study:-

1- To study to importance of capacity to contract in indian contract act

2-To study minor contract in Indian contract act

3- To study contract with lunatic person in Indian contract act

4- Difference between Indian and England law in minor and lunatic person contract

Research question:-

1-How minor person case are dealt by the court .

2- How lunatic person case are dealt by the court .

Methodology:-

The proposed project work is based on doctrinal method of data collection .

Review of Literature :-

This project work will be done by referring the sources mentioned below
1. https://indiankanoon.org/doc/831280 for definition and various sections of Indian contract act
2. http://www.legalservicesindia.com/article/289/Hear--Say-In-Contracts.html for case laws on
capacity to contract
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