Capacity of Parties to Contract | Indian Contract Act 1872 | CA Foundation
Channel: Learning With Nirmal
Date: 2023-02-19

This video talks about the following topics
Section 10 states that one of the essentials of a valid contract is that 
parties to the contract must be competent to enter into a contract
Section 11 of the ICA states that every person is competent to enter into 
contract who is:
(a) Of the age of majority according to the law to which he is 
subject to
(b) Of sound mind, and
(c) Not disqualified from contracting by any law to which he is 
subject 
(A)Minor’s Agreement 
According to Section 3 of the Indian Majority Act 1875, a minor is a 
person who has not completed 18 years of age, except in cases where 
guardian of a minor or his property or both is appointed; the age of 
majority is 21 years.
(1) An agreement with or by a minor is void-ab-initio and inoperative 
It is clear u/s 10 & 11 that a minor is not competent to enter into a contract 
but neither section 10 or 11 clarify whether the agreement with minor is void 
or voidable.
Case Law – Mohiribibi vs Dharmodas Ghose
A minor D mortgaged his house in favour of M to get a loan and M 
advanced the loan. Subsequently, D sued M for setting aside the mortgage 
stating that he was underage when he executed the mortgage.
It was held that: 
The mortgage was void and therefore it was cancelled
The money lender requested for repayment of the amount advanced 
by him to the minor as part of consideration for the mortgage but 
court held it as a void agreement.
It is a settled law now that a minor’s contract is void from the very beginnin
(2) Minor’s Agreement cannot be ratified on attaining majority 


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