Capacity to Contract

Sec.10 12 of ICA,1872

Section 10
Parties to the contract must be competent to contract

Who are competent to contract:

Section

11: Age of ma orit! Soun" min" #ot "is$ua%ifie" from contracting b! an! %a& to &hich he is sub ect

INCAPACITY
Minority (immature mind) Disqualified by law (Status)

nsound mind

!diot

"unatic

Drun#ard

$olitical Corporate Status: Status: a) %lien &nemy a) Company b) %lien 'riend b) Statutory c) 'orei(n So)erei(ns *Corporations d) %mbassadors

Marital Status: Married Women

"e(al Status: !nsol)ent person

M!+,-!./
Sec. ', of In"ian (a orit! Act,187)

Minors contracts
A

contract &ith or b! a minor is *oi" + a minor therefore can,not bin" himse%f b! a contract.1 A minor can be a promisee or a beneficiar! A minors agreement can,not be ratifie" b! the minor on his attaining ma orit!2

 If

a minor has recei*e" an! benefit un"er a *oi" contract,he can,not be as-e" to refun" the same' A minor is a%&a!s a%%o&e" to p%ea" minorit!. A minor can,not be a partner in a partnership firm A minor/s state is %iab%e to a person &ho supp%ies necessaries of %ife to a minor ) A minor can act as a agent

Minor0s parents1(uardians are not liable to a minor0s creditor for the breach of contract by the minor

Mental !ncompetence Sec213 : .est of soundness of mind Soundness of mind of a person depends on two 'acts : i) 4is capacity to understand the terms of the contract * ii) 4is ability to form a rational 5ud(ement as to its effect upon his interest