LAW OF CONTRACT

essential to the agreement, the agreement is void(Sec. 20). In such a case

is no consent at all.
The various causes leading to flaw in consent' will now be discusse
by one in detai.

COERCION
Definition
Section15 ofthe Contract Act defines Coercion'asfollows:
Coercion is the commiting or dhreatening to commit, any act forbie
bythe Indian Penal Code. or theunlawful detainingor threateningtode
any property, to the prejudice of any personwhatever, with the intentio
causing any person to enter into an agreemept."
The Explanationto the Section further adds that "it is immaterial whes
the Indian Penal Code is or is not in force in the place where the coercie
employed."
The above definition can be analysed as follows:
Coercion implies-(a) committing or thyeâtening to commit any
1.
forbidden by the Indian Penal Code;" or (haílawful detaining or threater
to detain any property, with the intention of causing any person to enteri
an agreement.
ILLUSTRATIONS. (1) AMadrasi gentleman died leaving a young widow. Th
relatives of the deceased threatened the widow to adopt a boy otherwise the
would not allow her to remove the dead body of her husband for cremation. The
widow adopted the boy and subsequently applied for cancellation of the adoption
It was held that her consent was not free but induced by coercion, as any persom
who obstructed a dead body from being removed for cremation, would be
guilty
of an offence under Section 297 of the I.P.C. The adoption was set aside
(Ranganayakamma vs Awar SettiP).
(ii) L, threatens to shoot M, if he does not let out his house to him. M agrees to
let out his house to L. The consent of M has been induced by coercion.
ii) An agent refused to hand over the account books of the business to the new
agentsentinhis place, unless the Principal released him from alliabilities. The
Principal had to give a release deed as demanded. Held, that the release deed was
voidable at the instance of the Principal who was made to execute the release
deed under coercion (Muthia vs Karuppan").
(iv) The Government gave a threat of attachment against the property of A , 1or
the recovery of a fine due from
B, the son of A. A, paid the fine. Held, the
payment of ftine was induced by coercion and therefore A was entitled to
the money paid to remove recover
wrongful attachment (Bansraj vs The Secy ofState).
2. Threat to shoot, murder, intimidation, threat to cause hurt,
rape, defamation, givn=
wrong evidence, instigating to commit crime, theft, to commit suicia are
few examples of acts forbidden attempt
by Indian Penal Code.
3. (1889), 13 Mad. 214.
4. (1927), 50 Mad. 786
5. (1939), A.W.R 247
 FREE CONSENNT

heact constituting coercion, may be directed at any person, and not

pssarily at
necessarily atthe
the other party to the
agreement. Likewise it may proceed even
from astranger to theconttact
LLUSTRATIONS. (a) 4, threatens to shoot B, afriend of CifC does not let out
his
house to him.
hishouse agrees to do so. The agreement has been brought about by
coeTcion

)A. threatens to shoot B ifhe does not let out his house to C. Bagrees to let out

his housctoCFsconsent has been caused by coercion

does not matter whether the
Indian Penal Code is or is not
in force i
the
thepplacewhere the coercion is employed. ifthe suit is filed in India, the above
provision( Sec. 15)will apply.
ILLUSTRATION(Appended to Sec. 15), A. on board an Emglish ship on the
high scas. causes B to enter into an agreement by an act amounting to criminal
intimidation under the Indian Penal Code. A, afterwards sues B for breach of
intim

contract at Calcutta. A, has employed coercion, although his act is not an offence
by the law of England and although Section 506 ofthe Indian Penal Code was not
in force at the time when, or place where, the act was done.
to file a suit. lo threaten a criminal or civil prosecution does not
,Threat
constitute coercion becuse it is not an act forbidden by the Indian Penal
Code. Butathreatto ilesuit on afalsechargeconstitutes coercion, for such
an act is fordden by the I.P.C.
(Askari Mirza vs Bibi Jai Kishor?)
commit suicide"
Threat to commit suicide. Neither suicide' nor threat to
to commit suicide
is punishable under the Indian Penal Code; only 'an attempt there
is punishable under it. In Chikkam Ammiraju vs Chikkam Seshamma
arose a question as to whether 'athreattocommit suicide'
amounts to coercion,
Court answered the question in the
and their Lordships of the Madras High
coercion. In that case a person, by a
affirmative holding that this amounts to in
induced his wife and son to execute a release deed
threat to commit suicide, claimed as
favour of his brother in respect
of certain properties which they
grounds of coercion. It was
their own. The transaction was set aside on the
commit suicide'was
stated by the majority of judges
that though 'a threat to
to be forbidden
Indian Penal Code, i(must bedeemed
not punishable under the suicide' was punishable
under Section
to commit
by that Code, as 'an attempt "The term 'any act forbidden by
that Code. Their Lordships observed:
309 of than the term punishable by the Indian Penal
the Indian Penal Code is wider that the
punishment, it does not follow
Code.' Simply because a man escapes not
or a minor may
Penal code. For example, a lunatic
act is not forbidden by the not forbidden by
show that their criminal acts are
This does not
Depunished.
the Penal Code." Law to denote illegal
Duress. The term 'duress' used in English
is
(body) of
overthe
person
mprisonment oreither actual orthreatenedviolence
Mad. 33
7. (1918), 41
6. (1912), 16. I.C. 344.
 LAW OF CONTRACT

another party or his witfe or children with a view to obtain the consent
party to the agreement. In short, for duress"the act orthreat mustbe ai
the life or liberty ofthe other party to the contract or the members ofhise
A threat to destroy or detain property will not amount to 'duress. Th
Scope of the tem 'coercion, as defined in Section 15, is wider, bec=
includes threats over property also.

Effect of Coerclon
A contract brought about by coercion is voidable at the option
party whose consent was so caused (Sec. 19). This means thatthe agg
party may either exereisetheoptionto attirm thetransaction andholdthe
narty bound by it,orrepudiate the transaction by exercising a rie
rescission As per Section 64, if the aggrieved party optstorescinda voi
ontract, hemustrestore.anybenefitreceivedbyhimunderthe contract
other party from whonm received.
The burden ofproofthat coercion was used lies on the party who wa
set aside the contract on the pleavf coercion
UNDUE INFLUENCE L
Definition
Section 16() defines the term "Undueinfluence' as follows:
"A coniract is said to be induced
by undue influence where, (Oerelan
subsisting between the parties are such that oneof the parties is in a pos
1o dominate the willof the othe, andhe uses the position to obtaim
unfair advantage over the other."
The phrase "in a position to dominate the will of
the other" is clarifiec
the same Section under sub-section
(2), thus:
Section 16(2).Aperson is deemed to be ina position to dominate the -
ofanother
(a)where he holds a real or apparent authority over the
relationshíp between masterand the servant, police officer and theother, e.g.
)where he stands in a fiduciary relation to the other. Fiduciary accused
means a relation of relat
mutual trust and confidence. Such a relationship is
toexist in the following cases: father and son, guardian suppos
client, doctor and patient, Guru (spiritual adviser) and ward, solicitora
beneficiay, etc.:or and disciple, trustee a
where he makes a contract with a person
temporarily or permanently affected by reason of whose mental çapacity
age, illness, or mental
bodily distress. eg-old iliterate persons.
It is to be observed that for
proving the use of undue-influence both t
8. The power to rescind the
contract is lost in certain
cases. For details refer to
heading-Loss of Right of Rescission'
discussed later in this chapter.
t
 elel
d o m i n a t eh i s w l /

Influe
Presumption ofUndue the circumstances
to exist under
mentioned
presumedis where the
Pre e intluence and (c). In other words, for example,
(a), (b))
U n d u

in sub-clauses the contracting parties is that of master and servant,

above in sub-c

lationshipb b
abnship between
e or where one ofthe
solicitor and client. etc.,
doctor and patient, the
proving
reland son.
f a t h e ra n d s o n

person, there is no need of

oldilliteratewhose
a s to the contractis an consent was so caused.
the party
Merely
ps eo f undue
undue influence byto of undue influence inthese
prove the
existence

S narties is enough case.ofa.centract by or

is alsothere, in
sta l
Presumption
e s .
of undueintluence
P r e s u n n p t i
9
2shin woman. following
undue influence in the
with a
presumption of
There is. however.no presumption
engaged to marry, the
cases:

fusband and wife (n case ofpersons

Husbandan 10
will arise).
iiuence
ofundue
Mother anddaughter.
grandfather.2
Grandson and
i Landlord
and tenant13

i and debtor
14
be proved by the party
Creditor
influence shall have to
undue
cases,
In where there is
these existed. a
influence
that
undue
presumption.
In c a s e s
who
alleging
ofproof
andrebutting.the
proving thatthe person to
Burden influence the burden
of use his position not
of undue another, did
a positionto
oresumption the will of
to
dominate
wHo Was in
was in a position ine person
lie upon
the
or oppase
advantage, Wll can
rebut
(E)]. He that the
obtainan unfair otherSec.
16 madeli)
the will of the of facts disclosure
was
competent
dominate
arguing(Ithar
full
was in
receipt of
presumption by the other party
ithat free.
was
adequate, was obtains, by
price advice and
his
consent
his son B.
independent advanced money
to
than the
sum due t
(a) A, having from B for a
amount
greater influence is
LLUSTRATIONS. undue
a bond As
offather
influence, influence.
undue that
misuse ofparental advance. A employs contracting
parties is that he

n respect of the relationship

between

It will befor A
to prove

to exist
if the the father.
on A, undue influence
ofprooflies on
presumed alleging
B
a suit by
burden
son, the
nd undue
influence,

not empioy this chapter.

Cid later in
Woman'dealt
Pardanashin

A.IR. All. 104

see the heading (1944),
Also Ahmad Kamil, Cal. 773.
1367.
F a r a z a l i vs
A.LR. S.C.
Sar Boo, (1906), 33 (1970),
11 1Smail vs Hafiz Telengana
Narayana,
Cal. L.J.
135.
later in
this chapter.
Amma vs (1908), 8 dealt
Kinoo Mollai,
Lakshmi Transactions'
Nath vs
' U n c o n s c i o n a b l e

Promoda heading
to the
tor details refer
65
 LAW OF CONTRACT

disease or age, is indsced, by

B's influence over hi
(6) A. a man enfecbled by to pay B an unreasonable
sum for his professi
attendant, to agrec
his medical undue influe
undueinfluence. On a petition by alleging
A
services Bemploys
that the contract was not induced by ur
to
it lies on B, the doctor, prove
influence,
woman made a gift of almost
the whole of her property to
(c)An old illiterate
was managing her
estate. On a petition by the old lady for set
nephew, who
the onus lies on the nep
deed on the ground ofundue influence,
aside the gift
transaction is bona fide, well understood
and free from un
to prove that the
influence is presumed in such a case.
influence, because undue

Effect of Undue Influence

undue influence
by
When consent to an agreement is caused
of the party whose consen
agreement is a contract voidable at the option
so caused. such contract may be set aside either absolutely or, ifthe
Any
who was entitled to avoid it has received any benefit thereunder, upon
terms and conditions as the court may seem just." (Sec. 19-A)
ILLUSTRATIONS (Appended to Sec. 19-A). (a) A's son has forged B'sname
a promissory note. B, under threat of prosecuting A's son, obtains a bond fro-
for the amount of the forged note IfB suesonthis bond, the Court may set n
bondaside.
(6) A, a money lender, advances Rs 100 to B, an agriculturist and by und
influence, induces B to execute a bond for Rs 200 with interest at 6 per cent p
month. The Court may set the bond aside, ordering B to repay the Rs 100w
such interest as may seem just.
Thus,itwillbenoticedthatSection 19-A alsodeclares a contract bro
about by undueinfluence voidable at the option of the aggrieved party, ju
Section 19 so declares in case of a contract brought about by coerc
misrepresentation or fraud. The special feature ofSection 19-A is that whi
the case of rescission of a contract procured by coercion, misrepresentatio
fraud, any benefit received by the aggrieved party has to be restored ur
Section 64 of the Contract Act; under Section 19-A, ifa contract procured
undue influence is set aside6 the Court has discretion to direct the aggrie
party for refunding the benefit whether in whole or in part or set aside
contract without any direction for refund of benefit.
The following points must also be noted in this connection:
Lack ofjudgment, lack of knowledge of facts or absence offoresight
generally not by themselves sufficient reasons for setting aside a contract
the ground of undue influence. Persuasion and argument are also not
 FREE CONSENT

C n d u
due influence bya person, who is nota partyto the contraçt, may
7aket h e
contr
tract voidable. In other words, itis not necessary that the person
ominate the will of the other party must himselfbe benefited.
dominat

position
to
aa pocient if the third person in whom he is interested is henefited
Is suff+cier

h i n n a m m e vs Devenga Sangha")
onscionable Transactions

ir orunreasonable bargains belong

to thecategory of 'unconscionable
ions. These are such transactions where as between two contracting
in aa dominant position and makes an exorbitant profit of the
a n s a c t i o n s

one is in
oneis
arties,
thers distress.
take place mostly in
rate of interest. Unconscionable bargains
High where moneylenders charge high rates ofinterest
nvlending transactions
borrowers. The presumptionof undue
influenceon the ground of
om
needy
interestis.ralsed-ony-hen the
followingtwo things areproved:
igh rateof moneylender was in a position to dominate the willof the
that the
ofinterestis excessive without
orrower, and
rate
2. thatthe bargain is unreasonable i.e.,
nyvalid reason,, must have been obtained by
the law presumes
that consent
cases undue influence
In such burden of proving that there was no
and the must be
ndue influence that both the above conditions
noted
the creditor. It must be influence. There
will be no
es on
rise to a presumnption
of undue
be set aside on
for giving transaction will not
roved undue influence
and a if both
of of interest is high
resumption because the rate
influence, merely in a posítion to
undue is
round of footing (i.e., none of the parties (like tight reason
equal valid
ne parties are on
will ofthe other
party) or if there
exists
rate of interest.
ominate the for charging high village,
moneylender his
of
market conditions)
oney in debt the
to B, unconscionable. Itlies on B to
(a) A, being
ILLUSTRATIONS.

to be
terms
which appear (©)
influence
|1llustration to
a fresh loan on induced by undue
Contracts not
contract was
that the cent
prove moneylender
at 100 per
Section 16] her right to
a
Rs 1,500 from
borrowed her to establish
Hindu widow of enabling undue intiuence
)A poor the purpose no
interest for
was

annum rate of to provethatthere

per the
moneylender

maintenance. Itlieson in the

Swaminatha").
when there
is stringency
Annapurni vs the time unusually high
(Rannee loan at
loanexceptat
an
banker for
a
to a make the transaction in the
(C)A. applies declines to terms.
This is a
influen e

market. Thebanker these

induced by
undue
OnEy
accepts the loan on is not
A.
dle ot interest.

business,and
thecontract
cOUFse of
ary an
(dd to Section 16)
 LAW OF CONTRACT

Now-a-days, however, drastic legislation very State

in almost
maximum rates of interest etc.) has proved greater protection to debto
High prices. Asregards exorbitant pricechargedbythetrader., iti
consideped a case of undue influence.
Pafdanashin Woman
A s observed earlier. there is a presumption ofundue influence in c=
contract by or witha pardanashin woman'. She can avoid any contracte
by heron the plea ofundueintluence and it is for the other party to pro
noundueintluencewasused. For proving theatbsence of undue influen
other party will have to satisty the Courtrthatthe terms ofthe contrac-
full explained to hr, ) that sheunderstood theiplications, and w
to have independent dvice inthe matter, and (j thatshe freelyconser
the contract. It may benoted thatthetem "pardanashin here refers to a v-
who obseryves completeseclhusion(parda) from contact with peopleo
ner own family because of the custom ot her community,and one do
DEcome pardanashin simply becauSe she lives in somedegree of sec
(Shaik Ismail vs Amir Bibi Further, note that the protection gran
pardanashin woman is alsoextended toilliterate and ignorant ladies,
equallyexposedtothe danger and risk of an unfair deal (Sonia Parshin
M. Bgsha"
Distinction between Coercion and Undue Influence
Both, coercion and undue influence, vitiate consent and make the co-
ofone ofthe parties to the contract untree. Butthe following are the poir
distinctigr between the two:
XIn coercion, the consent of the aggrieved party is obtained by comm
orthreatening to commit an act forbidden by Indian Penal Code or detaini-
threatening to detain some property unlawfully. While in undue influence
consent of the aggrieved party is affected from the domination of the wi
one persqn Over another.
2 Coercion is mainly of a physical character involving mostly us
physical or yiolent force. Whereas undue influence is of moral chara
involvingAse of moral force or mental pressure.
3.here is no presumption of coercion by law under any circumsta
The irden of proof that coercion was used lies on the party whose con
was so caused. In the case of undue-influence, however, there is presump-
as to the same in the case of certainrelationships. In these cases there
need of proving the use of undue-influence by the party whose consent
Socaused
AWhilein the case of rescission of acontract procured by coercion
benefitreceived by the aggrieved party has to be restored under Section-
19. (1920). 4 Bom. L.R. 146. 20. (1950), A.LR. Cal. 17.
68
 Free Consent
145
need
gent need of money on the
part of
distress. borrower
nere
nt evidence
sufticient
of nental is not, of itself,
itself,

CASE:
LEADING CASE: RAGHUNATH PRASAD SARJU
(AIR 1924 PC 60) PRASAD
In this case, a person who was facing a criminal prosecution
dhe instance of his father borrowed on exorbitant terms a
fmoney to defend himself. He (the son) mortgaged his
sum of
property for a sum of Rs. 10,000 borrowed from the respondent
ent rate of interest (per month), subject to
father) at 2 per
condition that in the event of non-payment of interest, the
the conditio

terest will be calculated at the same rate on the principle of

nterest will
compound interest. In eleven years, the amount borrowed with
n0ound int
to Rs. 1,12,885. The appellant son, in a suitby
interest came
for the recovery of the amount, contended that
respondent
the
presumption of undue influence as the lender
be
there should had taken
unconscionable
rate of interest,
by fixing high distress.
of his mental
advantage
in this case, laid
down someimportaF han
The Privy Council, 0-P
principles: each other
between the parties to
The relations to dominate,
is in a position ene
must be such that
one
Once that position is
the will of the other. unconscionableness
ofthe
then only whether the contract nu
s u b s t a n t i a t e d

considered
i.e. the3)
be Upon
bargain is
to influence.

undue
induced by point
emerges,

has
been issue a third of
d e t e r m i n a t i o n
of this probandi
(burden
omus
the
is that of
which

proof). the m o n e y
needed

as
he accident.

50,000 in an
the
for Rs.
injuries
to sell
to Y
s e r o u s

contract

Lacs had rnu-2008][L.C.. -93

2 who that
nnd
w o r t h
Rs. a f his son t h e
ground
146
Lawo f Contract
(i) As between parties on equal footing, the
the reate
mee
mere
unconscionableness of the bargain does not creat
influence.
the presumption of undue
(i) The mere fact that the bargain is
a hard one is no
n
relief.
ground in itself for granting
not in such mental distre:
distress
Itwas held that the appellant was
to dominate his
will. Since t
would enable a moneylender
as
not there, presumption
fact of the of the will was
domination
not be raised,
even though thebarpa
argain
of undue influence could
had been unconscionable.
SHRIMATI V
SUDHAKAR R. BHATKAR
LEADING CasE:
(AIR 1998 Bom 122)
as a tenant in a part of the
In this case, the defendant stayed
illiterate widow, but was managing
house owned by plaintiff- an
over two decades. The defendant
her agricultural properties for
her to gift her entire
treated her as his mother and persuaded
out of love and affection,
property. She executed the gift deed,
the defendant could
in favour of the defendant. It was held that
not be said to be in a position to dominate her will and the gift
deed could not be said to have been executed under his undue
influence.
The High Court observed: "Influence in the eye of law
has to be contra-distinguished with persuasion. Any and every
persuasion by one party to the other to contract cannot lead to
inference/conclusion that such party has influenced the other
party. One may by his act/conduct convince and persuade the
other party to do a particular act and if the other party does
such an act freely and of own volition (may be to his/her
prejudice or to his/her disadvantage or even to his/her peril), it
cannot be said that such act was influenced by the other.
In the present case, the plaintiff was illiterate, but she
was intelligent
enough to manage her properties and was getting
agricultural land cultivated from various persons from time
time for about two decades and,
therefore, from the available
facts it cannot be inferred that she would
sign a document
without understandingthe purport of such document.
 Free Consent
sioh Court
The High Court 147
following ecisions: distinguished the present case,
from the
a) Smi. Jakri Devi v Smt.
HP 11) In that Rama Dogra
case an (AIR 1984
separately from her husband illiterate lady living
oroperty to the donee who was gifted all her landed
that there was an undue her lover.
influence Held,
donee who was in a exercised by the
of the owner.
position to dominate the
will
(b) Shivagangawa Madiwalappa Vulvari
Basangouda (AIR 1938 Bom 304) -

In
that case,
v

a young widow who had inherited her

brother's
property had no relative to look after her and who
could give her disinterested advice. Her husband's
brother came and lived with her appropriating her
income/property. Through the advice/assistance of
an influential watandar Patil she recovered her
property back. Patil lived with her in a stageof
immorality and having obtained from her a giíft of
all her property drove her away. Held that the gift
was presumably obtained through undue influence.

(c) Smt. Feroze v Makhan Singh (AIR 1973 MP 252)

- In that case the sale of the entire property by an
of
illiterate women was set aside on the ground
there was absence
undue influence/fraud because
independent advice, payment of sale
of - to sell the property
consideration to her, urgency
over the sale
deed to
to the vendee, and reading
the vendor.
relation to
the High Court
observed, in
tne present case, transaction can
Unconscionableness of the in a
Durden of proof": party was
whether one
into without deciding whether the
gone
of the other and
to dominate the will question of
uon influence. The
tran was the
result of undue
ction
LS of proof arises only thereafter
 148
Lawof Contract
elationship by blood, marrlage or adoptlon not sine qua non
The presumption of undue influence can be more easily established.
indeed may be transactions
hed and
etween pa
assumed in such cases as
between
and infant child, solicitor and client, or spiritual adviser andcircumsta
penitentpare
penitent, bu
it will arise in any case in which the facts show that the circumest
are such that influence can fairly be inferred. Thus, what is neca.
to establish the presumption is not that the parties should be relataa
related
are such th
that their relations are that
blood, marriage or adoption, but one
other. Even where they areare so rel
relat
1S in a superior position over the

may not arise,

for the influence may as well be t
the presumption airly
and wisely exercised.

CASE: SUBHAS CHANDRA DAS

MUSHIB v GANGA PRASAR
SAD
LEADING
DAS MUSHIB (AIR 1967 SC 878)
In this case, some agricultural property was gifted by a person
to his only grandson (through one of his two sons) to the total
exclusion of his sons. Although the donor was quite old, he
was taking active interest in his property. Four years after the
gift he died and still four years after that the other son questioned
the validity of the gift on the ground of undue influence.
The court approved the principles laid down in Raghunath
Prasad v Sarju Prasad (discussed above) and also noted the
fact that Sec. 16 is based on the English common law as noted
in the judgment of the Supreme Court in Ladli Prasad Jaiswal
v Karnal Distillery Co., and held that on the facts of the case
no presumption of undue influence could arise. "The
circumstance that a grandfather made a gift of a portion of his
property to his only grandson (on account of natural love and
affection), a few years before his death is not on the face of
it an unconscionable transaction."
The court noted that
merely because the parties werc
nearly related to each other there is no presumption of unau
 Free Consent
nfluence. IItt is mistake
a mistake to
treat undue influence
149
e s t a b l i s h e

by a
proof of the as
having
been
ch that the one of the relations
relied upon theparties
naturally
h a v i n gb e e n

nd the other was in a

f o radvice, and
other
in giving it. Up to that
in
position to dominate
the will
Such influence maypoint,
tirst

ofthe
made out. Suc 'influence' alone has
be used
andhelpfilly. But whether by the law of India or the law of wisely, judiciously
nd heore than mere
than
more mere influence must be
England, proved as to render
infhuencein the
n the language of law, 'undue'. It must be established
influrson
that a person
is in a position to obtain unfair advantage for
hinself

caurt further noted that where there is no relationship

The
ist
shown t o e x i s t from which undue influence is presumed, that

intluence must be proved (Halsbury's Laws of England, Third

Art. 293). There is no presumption of
vol. 17, p. 673,
Edn.. Vol.

of fraud merely donor is old or of week

because a
position of
sition
cter. There
racter. There is no presumption of undue influence in the
made
to a son, grandson, or son-in-law, although
caseofa
gift before his death.
donor's illness and a few days
the
during
practically no evidence
case, there was
In the present son had been gifted
the
domination of the son (whose of the
shout the of the execution
father at the time
over his transaction was not
property) the
Also, as noted above,
deed of gift.
unconscionable.

BHATTA
NARAYANA
TALENGAL
AMMA v
LAKSHMI
CASE: SC 1367)
LEADING (AIR 1970
for his
provision
negligent borne
made a very daughters
in this case, a
person and the
first two being dead) only to
one
of
wife (the whole of
his property
Unird donated the from
several
ailments

and
Dy her, The donor was
suffering
home.
his grandso
grandsons. nursing of any
in the absence

nd executed the deed in the

held that,
d i s c r i m i n a t i o n ,

Court for the

The Supreme
donor

side of
the
The
deed ofsettlement
from the
d o c u m e n t

xplanation influence
arose.
unconscionable

the presumption ofundue

Sumption unnatural
and
an
on the face of it w a s
 150 Lawof Contract
The plaintiff provision for his third
(donor) made negligible
he respondent. Thus,
the respondent,
wife in the form of naintenance from
No provision was
she was left to the mercy of the respondent.
in the residential house till
residential
made her right to reside
regarding should have
he should have
no
reason why
her death. Further, there was
left nothing to his two daughters
or to his children and
other children and
one grandson.
given his entire estate to only
draft of
settlement deed as
case, no
In the present directione
or under the plaintif's
prepared with the approval that the document was got
had stated
The plaintiff's wife while he was o f
the plaintifi
on
executed by using pressure fit condition to realize what he
not in a
infim mind and was
had failed to dispel the
grandson
was doing. The respondent the execution of the deed
as to the genuineness of
suspicion held to be invalid.]
settlement deed was
Thus, the
arise when one member of the family is prefered
Thus, difficult questions such cases, court
exclusion of all others. In
in a testament to the total
undue advantage was taken of the situation
usually require proof that
will' [Afsar Sheikh v Soleman Bibi (1976)
that created 'dominance of
undue influence. Of
2 SCC 142]. Mere preference is not a proof of
the "thing speaks
course, the circumstances may be so outrageous, that
for itself' 8
(2) Inequality of bargaining power (Economic duress)
The presumption of undue influence may also arise from the fact that
there is such an inequality of bargaining power between the parties tha
one can cause economic duress to the other.
Thus, in Lloyd Bank v Bundy (1975) 1 QB 326, a contractor
borrowed a sum from a bank, but could not pay back in time. Hs
father
mortgaged the family's only residential house to help him. The
contractor still could not pay and the banker sought to enforce he
mortgage. The court set aside the mortgage on the ground that the bans
exploited the vulnerability of the father, caused by his desire to heip his
 Free Consent
to cch
such an
an extent that
tha he 151
aratorium, which was charged his house to his
s o n ,

ort morator
s t h o r

a
mortgage. highly inadequate nuin for very a

Eploit
ion
needy of the consideration for hne
ps In
-

psit parties, courtdetermining

ns of the parties, the
the
respective bargaining
as age Oerty,
poverty, illito
illiteracy and
will look at a
number
money that is due emotional
of factors, such
less money that state.
accept
to Forcing person to
exampie of untair him by exploiting his person
a
string is an
gtrin was purchased on terms bargain. In case, a economic
a
cOpygh any other company but the he was not to publish hiswriter's
ny other
c o p y r i

that song
was held
It was held to be company had the right to songs
Songs. unconscionable reject his
Co v,Macauly (1974) 1 WLR 1308]. [Schroeder Music Publishing
regards exorbilant price charged
AS

ered aa case of undue case by the trader, it is never

sidered
.
influence. Also, there is
between
influencebe landlord and tenant
no
presumption of
undue
Moliali (1908) 8 Cal. LJ 135]. [Promoda Nath v Kinoo

nictinction between Coercion and Undue Influence9

tindue influence as well as coercion renders the contract voidable at
ste option of the party whose consent was so caused. However, in case
f coercion, the contract becomes voidable under Sec. 19 and the party
2Voiding the contract has to restore any benefit he has received under
has the
the contract to the other party. Under Sec. 19-A, the court such
undue influence. Any
power to set aside a contract induced by who was
cOntract may be set aside either absolutely or, if the party
thereunder, upon such terms
received benefit
Ttitled to avoid it has any
seem just.
ad conditions as to the court may
involves physical force, undue influence
Unlike coercion which forced to give his
is
OVES moral pressure. In
coercion, a person under the
consent freely
gives
Consent inundue influence, the giver such consent. Thus,
n to any loss by
giving case of
he is not to be put but not so in
at of coercion
thereamayybe criminal liability in case

coercion
and undue
n i t u
between
onswer with