Free Consent – Indian Contract Act, 1872

Definition and Importance
For a contract to be valid under Section 10 of the Indian Contract Act, 1872, it must be made with the free consent of the parties.
Section 13 defines consent as when two or more persons agree upon the same thing in the same sense (consensus ad idem).
Section 14 elaborates that consent is said to be free when it is not caused by:

Contents

Elements Affecting Free Consent Consequences of Lack of Free Consent Mind Map (Text Format)Situation-Based Questions FAQs on Free Consent Citations

Coercion
Undue Influence
Fraud
Misrepresentation
Mistake

If consent is not free, the contract may be voidable at the option of the aggrieved party.

Coercion
Defined under Section 15 as committing or threatening to commit any act forbidden by the Indian Penal Code, or unlawfully detaining or threatening to detain any property to compel a person to enter into an agreement.
Effect: Contract is voidable.
Case: Ranganayakamma v. Alwar Setti (1889) – Consent obtained under threat of refusing to perform funeral rites was held to be coercion.

Undue Influence
Section 16 deals with situations where one party is in a position to dominate the will of another and uses that position to gain an unfair advantage.
Presumed in cases of fiduciary relationships, mental weakness, or distress.
Case: Mannu Singh v. Umadat Pandey – A spiritual advisor induced a disciple to gift property. The court held it to be undue influence.

Fraud
Defined under Section 17 as a false statement made knowingly, without belief in its truth, or recklessly.
Includes acts intended to deceive.
Effect: Contract is voidable, and damages may be claimed.
Case: Derry v. Peek – Misstatement made without intent to deceive does not constitute fraud.

Misrepresentation
Under Section 18, it includes false statements made innocently or breach of duty without intent to deceive.
Effect: Contract is voidable, but damages cannot be claimed unless fraud is proven.
Case: With v. O’Flanagan – A truthful statement that became false due to changing circumstances amounts to misrepresentation if not corrected.

Mistake
Section 20 to 22 cover this:

Bilateral Mistake (of essential fact): Void
Unilateral Mistake: Generally not voidable
Case: Khalil Ahmed Bashir Ahmed v. Tufelhussein Samasbhai – Mistake as to identity was held material.

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Contract is voidable at the option of the party whose consent was not free.
The aggrieved party can either:
- Rescind the contract
- Insist on performance and be put in the position as if no coercion/fraud/misrepresentation occurred
Restitution may be required.

Mind Map (Text Format)

Free Consent
→ Defined under Section 14
→ Must be free from:
→ Coercion (Sec 15)
→ Undue Influence (Sec 16)
→ Fraud (Sec 17)
→ Misrepresentation (Sec 18)
→ Mistake (Sec 20-22)
→ Effect: Contract is voidable
→ Remedies: Rescind / Enforce with compensation / Restitution

Situation-Based Questions

Q1. A widow is pressured by relatives into selling property at a lower price. Is her consent free?
A1. No. If undue influence is established, the contract is voidable.

Q2. A sells land stating it is free from encumbrance, knowing it has a mortgage. Is it fraud?
A2. Yes. Intentional concealment amounts to fraud under Section 17.

Q3. X threatens to burn Y’s house unless he signs a contract. Valid?
A3. No. This is coercion, making the contract voidable.

What is the difference between coercion and undue influence?
Coercion involves physical or illegal threats, while undue influence involves moral pressure from a dominating relationship.

Is silence considered fraud?
Generally, silence is not fraud unless there is a duty to speak or it creates a false impression.

Can a contract be enforced if obtained through fraud?
Yes, but only if the aggrieved party chooses to affirm it. Otherwise, it is voidable.

Does mistake always make a contract void?
Only bilateral mistakes as to essential facts. Unilateral mistakes generally do not void the contract.