Free Consent - UNDUE INFLUENCE

Under Indian Contract Act 1872

Introduction:
Section 13 of Indian Contract Act 1872 talks about the consent of people in agreement with the same
things in the same sense. Section 14 of ICA further defines consent as an inevitable matter for a valid
contract and the factors vitiating the free consent are Coercion (section 15), Undue influence (section
16),Fraud (section 17), Misrepresentation (section 18) or Mistake (section 20-22). Undue Influence
occurs when a party's relationship is such that one party is in a position to dominate the will of another
and uses that position to gain advantages over others.

Undue Influence:
The term "undue influence" refers to the unfair use of one's superior power to obtain the consent of a
person in a weaker position.

According to Section 16(1), "a contract is said to be induced by undue influence when the relations
existing between the parties are such that one of the parties is in a position to dominate the will of the
other and uses that position to obtain an unfair advantage over the other."

Elements of Undue Influence:

1. It must be demonstrated that the victim was vulnerable. Susceptibility can be demonstrated by
conditions such as physical disability, physical dependency, and psychological or mental illness.
2. The opportunity must exist for undue influence to take place
● Parent and child
● Husband and wife
● Attorney and client
● Pastor and parishioner
● Doctor and patient
3. Evidence must be presented demonstrating that the defendant abused his or her power over the
victim. A defendant who is aggressive in isolating someone from having relationships with
others or discouraging someone from seeking advice from others may be considered to be
exercising undue influence.
4. Records must reveal a suspicious or otherwise unusual transaction. Changes to a last will and
testament made by a family member of a person diagnosed with a terminal illness, where the
family member stands to benefit from the modification, would be an example.
Positions that dominates others:
● Where one party holds a real or apparent authority over the other
● Where one party stands in a fiduciary relation to the other.
● Where one party makes a contract with another in a mental distress.

Variables of Undue influence:

Potential complications, vulnerability enhancers, and execution variables are the three undue influence
variables. There are several types of people who are skilled at taking advantage of vulnerable people.
These are the con artist, the psychologically damaged individual, the perpetrator, and the devious
individual.

Con artist

This person is aware of potential financial situations for others and works hard to divert the funds to
themselves.

Perpetrator

This person does not begin with malicious intent, but over time realizes that they can exploit another
person for their own gain. They are powerless to resist the temptation.

Psychological

This person seeks personal fulfillment through the exploitation of others.

Devious

Most people believe that increasing the dependency level of someone who is vulnerable is a very simple
undertaking.

Effects of Undue Influence:

"When permission to an agreement is obtained through undue influence, the agreement is voidable at
the choice of the person whose consent was obtained through undue influence."

Any such contract may be annulled either completely or, if the party entitled to avoid it has reaped any
profit from it, on such terms and conditions as the court deems just.
Important cases related to Undue influence:
1. Raghunath v. Sarju Prasad

2. Lloyds Bank v. Bundy

3. Mannu Singh v. Umadat Pandey

4. William v. Bayley

Sources:
FREE CONSENT (COERCION, UNDUE INFLUENCE, FRAUD, MISREPRESENTATION,
MISTAKE) – Legal Code

Concept of Coercion, Undue Influence and their differences | Law column

Undue Influence under Contract Law (ipleaders.in)

What is Undue Influence under Contract Law (with Examples)? | DocPro