Busi

nessLaw(
Topi
cName:Fr
eeConsent
)

1.Fr
eeConsent
:Meani
ng

Asdiscussedear l
i
er ,
freeconsentisanessentialrequi
rementofav al
idcontr
actundersecti
on
10oftheAct .
Accor di
ngt osecti
on13oft heIndianContractAct,
twoormor eper
sonsaresai dt
o
consentwhent heyagr eeuponthesamet hi
nginthesamesense. Iti
sessenti
altothecreat
ion
ofacontractthatbothpar t
iesshouldagreetothesamet hingi
nthesamesense.Itisnotonly
the'
consent'
but'freeconsent'whichisnecessaryforav ali
dcontr
act.

Thet
ermt
erm'
fr
eeconsent
'hasbeendef
inedi
nsect
ion14oft
heAct
.

Accor
dingt
othi
spr
ovi
sion,
consenti
ssai
dtobef
reewheni
tisnotcausedby
-

(
1).
coer
cion,
asdef
inedi
nsect
ion15,
or

(
2)unduei
nfl
uence,
asdef
inedi
nsect
ion16,
or

(
3)f
raud,
asdef
inedi
nsect
ion17,
or

(
4)mi
srepr
esent
ati
on,
asdef
inedi
nsect
ion18,
or

(
5).mi
stake,
subj
ectt
othepr
ovi
sionsofsect
ion20,
21and22.

Whentheconsenti
sobtai
nedbycoerci
on,
unduei
nfl
uence,
fraudormi
srepr
esent
ati
on,
the
cont
racti
svoi
dableatt
heopti
onofthepart
ywhoseconsentwassoobtai
ned.

Howev
er,
whent
heconsenti
scausedbymi
stake,
theagr
eementi
svoi
d.

COERCI
ON[
sect
ion15]:

"Coerci
on"i
sthecommitti
ngort hreat
eni
ngtocommi tanyact,f
orbiddenbytheIndi
anPenal
Code1860ort heunl
awfuldetai
ningorthr
eateni
ngtodetai
n,anypropert
y,t
otheprej
udiceofany
personwhatever,
wit
htheintenti
onofcausinganypersontoenterintoanagreement.

I
ll
ust
rat
ions.
(1)Leadi
ngcase:
Ranganay
akammaVsAl
warSet
ti
(1889),
13Mad.
214.

AMadr asigentl
emandi edleavingayoungwidow.Ther el
ati
vesoft
hedeceasedthreatenedthe
widowt oadoptaboyot herwisetheywouldnotal
lowhert oremovethedeadbodyofher
husbandforcremation.
Thewi dowadoptedtheboyandsubsequent l
yappli
edforcancell
ati
onof
theadopti
on.I
twashel dthattheadopti
onwasnotbi ndi
ngonherasherconsentwasobt ai
ned
undercoerci
onwi t
hinthemeani ngofsec15si
nceanyper sonwhoobstruct
edadeadbodyf rom
beingremovedforcremat i
on,wouldbeguil
tyofanof f
enceundersec297oftheIPC.The
adopti
onwassetasi de.
(
2)Lthr
eat
enstoshootM,ifhedoesn'tl
etouthi
shouset
ohi
m.M agr
eest
oletouthi
shouse
t
oL.
TheconsentofM hasbeeninducedbycoerci
on.

Anagr
eementi
nducedbycoer
cioni
svoi
dabl
eandnotv
oid.

Thatmeansi
tcanbeenf
orcedbyt
hepar
tycoer
ced,
butnotbyt
hepar
tyusi
ngcoer
cion.

UNDUEI
NFLUENCE[sect
ion16]:
-"Acont
racti
ssai
dtobei
nducedbyunduei
nfl
uence
wherether el
ati
onssubsi
sti
ngbet weent heparti
esaresuchthatoneoftheparti
esisina
posit
iontodomi nat
ethewil
l oft
heot herandusesthatposit
iontoobtai
nanunf ai
radv antage
overtheother.
"Apersoni
sdeemedt obei napositi
ontodomi nat
ethewilloft
heot her,whenhe
holdsauthori
tyreal
orapparentovertheot her
,orwhenhestandsinaf i
duciar
yrelati
ont othe
other.

Exampl
es:I
)Af
ather
,byr
easonofhi
saut
hor
it
yov
ert
hesoncandomi
nat
ethewi
l
loft
he
son.
Fort
hesamer
easont
hehusbandcandomi
nat
ethewi
l
loft
hewi
fe.

i
i
)Agi
nbyr
easonoff
iduci
aryr
elat
ionshi
p,asol
i
cit
orcandomi
nat
ethewi
l
lofhi
scl
i
entand

i
i
i).
Atr
ust
eecandomi
nat
ethewi
l
loft
hebenef
ici
ary
.

i
v)Simil
arl
yaper sonwhosement alcapaci
tyi
saf
fect
edbyage,
il
lnessordi
str
essmaybeaprey
toundueinfl
uence.Fori
nstance,
adoctori
sdeemedtobei
napositi
ontodominatet
hewil
lofhi
s
pati
entenfeebl
edbypr ot
ractedi
ll
ness.

FRAUD[
sect
ion17]:

Theter
m'f
raud'
incl
udesal
lact
scommi
tt
edbyaper
sonwi
thani
ntent
iont
odecei
veanot
her
per
son.

Aspert heAct,
"fr
audmeansandi ncludesanyoneofthefoll
owingactscommit
tedbyapar
tyt
o
acont
r act,
orwit
hhisconnivance,orbyhisagent,
withi
ntenttodecei
veortoi
nduceanot
her
par
tytheretoorhisagent
,t
oent erint
ot hecont
ract.

1.
Thesuggest
ion,
ast
oaf
actoft
hatwhi
chi
snott
ruebyonewhodoesnotbel
i
evei
ttobet
rue;

2.
Theact
iveconceal
mentofaf
actbyaper
sonwhohasknowl
edgeorbel
i
efoft
heact
;

3.
Apr
omi
semadewi
thoutanyi
ntent
ionofper
for
mingi
t;

4.
Anyot
heractf
it
tedt
odecei
ve;

5.
Anysuchactoromi
ssi
onast
hespeci
all
ydecl
arest
obef
raudul
ent
.

Exampl
es:(
1)Asel
l
s,byauct
ion,
toBahor
sewhi
chAknowst
obeunsound.
Asay
snot
hingt
o
Baboutt
hehor
sesunsoundness.
Thi
sisnotf
raudbyA.
(
2)BisA'
sdaughterandhasjustcometoage.Here,
ther
elat
ionbet
weent
hepar
ti
eswoul
d
makei
tA'
sdutytotellBi
fthehorseisunsound.

Secti
on17revealsthatf
raudisanuntr
uestat
ementwhichi
sdeli
berat
elymadewit
hout
bel
ievi
nginit
struth.
Butifapersonmakesafal
sestat
ementingoodandwithut
most
honesty
,hecannotbeheldguil
tyoff
raud.

I
nspit
eoftheobj
ectoft
hepersonmaki
ngfr
audbeinggood,
i
tdeserv
est obecall
edafr
aud.
All
unf
airact
s,commit
tedt
odeceivet
heot
herpar
tycomeunderthecategoryoff
raud.

MI
SREPRESENTATI
ON[
sect
ion18]:

Theterm'Misrepr
esentat
ion'meansafalserepresent
ati
onoffactmadeinnocentl
yor
nondiscl
osureifamateri
al f
actwit
houtanyintenti
ontodecei
vetheotherpart
y.Sect
ion18
defi
nestheterm'misrepresent
ati
on'asfol
lows:

I
)Theposi
ti
v easser
ti
on,i
namannernotwarr
antedbytheinf
ormat
ionoft
heper
sonmaki
ng
i
t,
oft
hatwhichisnottr
ue,
thoughhebel
i
evesi
ttobetrue;

i
i).
Anybreachofdutywhich,
withoutani
ntenttor
eceiv
egainsanadvant
agetotheper
son
committ
ingit,
oranyoneclai
mingunderhi
m, bymisl
eadinganot
hert
ohispr
ejudi
ceortot
he
prej
udi
ceofanyonecl ai
mingunderhim,
;

i
ii
).Causi
nghowev
erinnocently
,apart
ytoanagreement
,t
omakeami
stakeast
othesubst
ance
ofthethi
ngwhi
chist
hesubj ectoftheagr
eement.

MI
STAKE[
sect
ion20]:

Accordi
ngt
oSection20oft
heIndi
anCont r
actAct,
"Whenbotht
hepart
iestoanagreementar
e
underamistakeastoamatt
eroffact
,essent
ialt
otheagreement
,t
heagreementi
sv oi
d.

Fol
l
owi
ngt
hreecondi
ti
onsmustbef
ulf
il
ledf
ort
heagr
eementt
obecomev
oid:
-

1.
Bot
hthepar
ti
esbei
ngundermi
stake,

2.
Mist
akeoff
act
,

3.
Thatf
actbei
ngessent
ial
fort
heagr
eement

Mistakemaybedef i
nedasanerr
oneousbeli
efconcer
ningsomething.
itmaybei
ftwoki
nds
"mistakeofl
aw'and'mi
stakeoff
act
'.Mist
akeoflawmeansev er
yoneisdeemedtobe
conversantwi
ththel
awofhiscount
ry,
andhencethemaxim"ignoranceoflawi
snoexcuse.
"

Mist
akeofl
aw,
ther
efor
e,i
snoexcuseandi
tdoesn'
tgi
ver
ightt
othepar
ti
est
oav
oidt
he
cont
ract
.

Mi
stakeoff
actmaybei
ftwot
ypes.
.I
)Bi
l
ater
almi
stake-Wher
ethepar
ti
est
oanagr
eement
mi
sunder
stoodeachot
herandar
eatcr
osspur
poses,
ther
eisabi
l
ater
almi
stake

Uni
lat
eral
mist
ake:

Whereonl
yoneofthecont
ract
ingpar
ti
esi
smi
stakenast
oamat
teroff
act
,t
hemi
stakei
sa
uni
l
ater
almist
ake.

St
ati
ngt
heef
fectofmi
stakeast
olaw,
Sec21

decl
arest
hat
"acont
racti
snotv
oidabl
ebecausei
twascausedbyami
stakeast
oanyl
aw
i
nfor
ceinI
ndi
a.

Ref
erences:

1.I
ndi
anCont
ractActbyDrAv
tarSi
ngh.

2.I
ndi
anCont
ractActbyR.
K.Bangi
a.,
All
ahabadLawAgency
,Far
idabadHar
yana

3.
Busi
nessl
awbyMCKuchhal
&Vi
vekKuchhal
.

4.
Busi
nessl
awbyN.
D.Kapoor
.