Question

Given below is a statement of legal principle followed by a factual situation. Apply the principle to the facts and select the most appropriate answer.

Principle: Every person, who is of the age of majority, is competent to contract according to the law to which he is subject.

Facts: A minor mortgaged his house in favour of Thakur Das, a money lender, to secure a loan of ₹20000. A part of this, i.e. ₹10500 was actually advanced to him. While considering the proposed advance, the attorney who was acting for the money lender, received information that the plaintiff was still a minor. Subsequently the minor commenced an action stating that he was underage when he executed the mortgage and the same should, therefore, be cancelled. He prayed for setting aside the mortgage. The mortgagee money lender prayed for the refund of ₹10500 from the minor.

Options

• As a minor’s contract is void, any money advanced to a minor can be recovered.

• A minor’s contract is void ab initio, any money advanced to a minor cannot be recovered. 

• A minor’s contract is voidable; any money advanced  to a minor can be recovered 

• Advanced money can be recovered because the minor has given wrong information about his age.

Answer 1

A minor’s contract is void ab initio, any money advanced to a minor cannot be recovered. 

Explanation:

A person by reason of infancy is incompetent to contract, cannot make a contract within the meaning under Section 10 of the Indian Contract Act. The Minor contract is void ab initio and money advanced to a minor cannot be recovered. It was held in the famous case Mohiri Bibee v Dharmodas Ghosh.