Factors that vitiate free consent

We have in the earlier lesson read of "free consent". At times contracts are made without free consent. On the face of it one may feel the consent is free. But actually consent may not be free. That makes the contract ‘voidable’.

 We shall explain this with some examples:

 If any of the following was used to obtain consent, the consent was not free.

1)      Coercion – it is coercing some one to give his consent. E.g. If A  asks B at gun point to execute a promissory note, and B, to save his life does as told, B’s consent is said to be not free.

2)      Undue influence – E.g. An old man living with his son has been asked by his son to make a sale deed and transfer his property to the son – the consent of the old man (if given) is not free consent. A clergyman motivates a devout church member to part with his landed property in his favor. The member’s consent is not likely to be free.

3)      Misrepresentation – E.g. A makes a representation to B believing it to be true (actually it is not) and B acts on it. B’s consent is not free consent. It is vitiated by misrepresentation. The point to be noted is that the one who made the representation believed the representation to be true. Misrepresentation makes a contract voidable. However, section 19 of the Indian Contract Act puts an exception to this general rule. It says that if any contract is caused by misrepresentation, or by silence, fraudulent within the meaning of section 17 (fraud), the contract nevertheless is not voidable, if the party whose consent was caused had the means of discovering the truth with ordinary diligence.

4)      Fraud – E.g. A makes a representation to B, knowing well that it is false and expects B to act on that believing it to be true – and B acts on it – B’s consent is not free as it is vitiated by fraud.

5)      Mistake – Mistakes may be of law or fact. Law of our country is supposed to be known to all. But laws of a foreign country are treated as facts. Mistakes pertaining to law and facts at the time of giving consent also make the contract voidable on account of lack of free consent.

In order to make a contract void on the ground of mistake – (a) both parties to the contract must be under a mistake (b) mistake shall be one of fact and not of law and (c) mistake should be essential to the contract.

Mistake of a fundamental nature can vitiate the basic consent. As such there will not be consensus ad idem. There can be a mistake as to the persons involved in the contract. There can be a mistake as to the subject matter. In Raffles vs Wichelhaus (1864), Wichelhaus agreed to buy from Raffles a cargo of cotton “Ex Peerless, Bombay”. There were in fact two ships with that name about to leave Bombay at that time; Raffles had in mind one ship, Wichelhaus had in mind the other. It was held that the mistake as to the identity of the subject matter rendered the agreement void.

Please note that a contract is not voidable on account of mistake of an Indian law.


Key words:

voidable contracts
Coercion
Undue influence
Misrepresentation
Fraud
Mistake