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Case Analysis: Mohori Bibee V. Dharmodas Ghose

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Name of the Case

Mohori Bibee V. Dharmodas Ghose

Equivalent Citation

(1903) ILR 30 Cal 539 (PC)

Date of Judgement

04 March 1903

Name of Judges 

Lord McNaughton, Lord Davey, Lord Lindley, Sir Ford North, Sir Andrew Scoble, Sir Andrew Wilson.

Facts of the Case

In this case, the respondent was Dharmodas Ghose. He was a minor (i.e., he had not reached the age of 18), and he was the only owner of his immovable property. Dharmodas Ghose’s mother was appointed as his legal guardian by the Calcutta High Court. He was a minor when he went for the mortgage of his own immovable property in favor of the appellant, Brahmo Dutta, and obtained this mortgage deed for Rs. 20,000 at a 12% interest rate each year. Brahmo Dutta, a money lender at the time, acquired a loan of Rs. 20,000, and the management of his firm was in the hands of Kedar Nath, who functioned as Brahmo Dutta’s attorney. Dharmodas Ghose’s mother notified Brahmo Dutta about Dharmodas Ghose’s minority on the day such mortgage deed was started, but the proportion or quantity of loan that was actually granted was less than Rs. 20,000. The defendant’s representative, who actually acted on behalf of the moneylender, gave money to the plaintiff, who was a minor, and he was fully aware of the plaintiff’s incompetency to perform or enter into a contract, as well as that he was legally incompetent to mortgage his property, which belonged to him. On September 10, 1895, Dharmodas Ghose and his mother filed legal action against Brahmo Dutta, claiming that the mortgage Dharmodas executed was commenced while he was a minor or infant, and thus such mortgage was void, disproportionate, or improper, and as a result, such contract should be revoked. Brahmo Dutta died while this petition or claim was being processed, and the appeal or petition was then litigated by his executors. The plaintiff contended or addressed that in such a scenario, no relief or assistance should be granted to them since, in his opinion, the defendant had dishonestly misunderstood the truth about his age. Furthermore, if the mortgage is terminated at the request of the defendant, Dharmodas Ghose.

Issues

  • Whether or not the deed was void under sections 2, 10, and 11 of the Indian Contract Act of 1872.
  • Whether or whether the defendant was obligated to repay the amount of debt obtained under such deed or mortgage?
  • Whether or if the defendant’s mortgage was voidable?

Judgment 

According to the Trial Court’s decision, the mortgage deed or contract that was initiated between the plaintiff and the defendant was void since it was completed by a person who was a baby at the time of mortgage execution.

When Brahmo Dutta was dissatisfied with the Trial Court’s decision, he filed an appeal in the Calcutta High Court.

According to the ruling of the Calcutta High Court, they concurred with the verdict of the Trial Court and dismissed Brahmo Dutta’s appeal.

Then he proceeded to the Privy Council for an appeal, and the Privy Council likewise denied Brahmo Dutta’s petition, ruling that there can be no contract between a minor and a major.

The council’s final conclusion was that any contract entered into with a child or newborn is void/void ab initio (void from beginning).

Because the minor was incompetent to create such a mortgage, the contract that was established or begun is likewise void and unenforceable in the eyes of the law.

Because he was not bound by the commitment that was fulfilled in a contract, the minor, Dharmodas Gosh, cannot be forced to repay the amount of money that was advanced to him.

This case analysis is written by Mudit Jain, pursuing B.B.A.LL.B.(H) from Indore Institute of Law.

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Case Analysis: Khan Gul V. Lakha Singh

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In Lahore High Court

Case No.

AIR 1928 Lah 609

Equivalent Citation:

(1928)ILR9LAH701

Decided on

2nd April 1928

Bench 

Sir Shadi Lal; Justice Broadway; Justice Harrison; Justice Tek Chand; Dalip Singh.

Facts of the Case-

In this case, defendant 1 negotiated to sell a parcel of property to the plaintiff while still a child and fraudulently concealing his age He was given Rs. 17,500/- as payment, the plaintiffs had paid Rs. 8,000 in cash to the Sub-Registrar, and the remaining Rs. 9,500 was secured by a promissory note due on demand. The plaintiffs claimed that defendant 1 was lawfully paid Rs. 17,500 since the promissory note for Rs. 9,500 in his favor was discharged by another promissory note issued by the plaintiff in favor of the defendant’s brother-in-law Muhammad Hussain at the request of the defendant 1, that the plaintiffs had paid Rs. 5,500 of the Rs. 9,500 to Muhammad Hussain and were willing to pay the remainder. After receiving money the Defendant 1 had refused to give ownership of the property, and the plaintiffs requested that possession of the property sold be handed to them, or that a decree for Rs. 17,500, the consideration money, be issued together with interest or damages deriving from breach of contract at the rate of 1% per mensem, totaling to Rs. 1,050, i.e., for Rs. 19,000 in total, might be passed against defendant 1’s other property.

Issues before the Hon’ble Court-

  • Whether a juvenile who has convinced a person to sign into a contract by fraudulently claiming himself to be a major is barred from arguing his minority to escape the contract.
  • Whether a party who, as a minor, entered into a contract by making a false representation about his age, whether as a defendant or plaintiff, can decline to fulfill the contract while retaining the advantage he may have gained from it in a future dispute.

Judgment-

  • Prior to 1903, there was considerable doubt over a minor’s competence to enter into a contract, as to whether a minor’s contract was invalid or voidable.
  • However, all doubt on the subject has been removed by their Lordships’ Privy Council’s decision in Mohori Bibee v. Dharmodas Ghose, which declares that a person who is incompetent to contract due to infancy, as defined by Section 11 of the Contract Act, cannot make a contract within the meaning of the Act. The transaction entered into is not legal.
  • The law of estoppel is a universal law that applies to all people, but the law of contract pertaining to the ability to engage in a contract is focused on a specific object, because it is a well-established concept that when the legislature expresses a general-purpose as well as a special intention that is incompatible with the general one, the particular intention is deemed an exception to the general one: according to Best, C.J. in Churchill v. Crease
  • The rule against applying the theory of estoppel to a contract invalid on the basis of childhood has been adopted in India, not only by the Calcutta High Court, but also by the High Courts of Madras, Allahabad, and Patna. However, a Division Bench of the Lahore High Court agreed with the Bombay High Court in Wasinda Ram v. Sim Rant.
  • In Mohoree Bibee v. Dharmodas Ghose, an appeal from the Calcutta High Court’s decision in Brahma Datt v. Dhurmo Dass Ghose, their Lordships abstained from expressing a view and disposed of the matter by making the following observation: The lower courts appear to have determined that this provision (S. 115) does not apply to babies, but their Lordships do not believe it is essential to address that issue at this time. They believe it is obvious that the section does not apply in a case like this one, where the statement relied on is made to a person who is aware of the true facts and is not deceived by the false statement.
  • The balance of court authority in India is decisively in favor of the rule that if an infant had convinced a person to contract with him by the false representation that he was of full age, he is not estopped from pleading his immaturity in avoidance of the contract and, despite Section 115, The Evidence Act is broad in scope, and the court held that it must be read in conjunction with the Contract Act, which declares a transaction carried into by a minor invalid.
  • As a result, the answer to the first question posed is negative.
  • Second, an infant’s fraudulent assertion that he was of full age gives rise to equitable responsibility. While absolving him of the contract’s implications, the Court may, in the exercise of its equitable power, return the parties to the position they were prior to the date of the contract (Doctrine of Restitution).
  • In Stocke v. Wilson, a baby who had received furniture from the plaintiff by fraudulently claiming to be of age and had sold some of it for £ 30 was ordered to pay this sum to the plaintiff as part of the remedy given.
  • The answer to the second issue is that, while an infant is not accountable under the contract, he may be forced in equity to repay the advantage he got by lying about his age.
  • In dissent, Harrison J. stated that a minor who entered into a contract by making a false representation about his age, though not liable under the contract, may be required in equity to return the benefit he received by making a false representation about his age, whether he is a defendant or a plaintiff.

The case analysis is done Mudit Jain, currently pursuing B.B.A.LL.B.(H) from Indore Institute of Law.

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