A promissory note was signed by a minor for consideration received by him. On attaining majority, he ratifies that promissory note. Can the creditor enforce it? Explain.

Question: A promissory note was signed by a minor for consideration received by him. On attaining majority, he ratifies that promissory note. Can the creditor enforce it? Explain. [DJS 2011]

Find the answer to the mains question only on Legal Bites. [A promissory note was signed by a minor for consideration received by him. On attaining majority, he ratifies that promissory note. Can the creditor enforce it? Explain.]

Answer

A minor’s agreement is when a minor enters into an agreement (which is void ab initio according to the law).

Section 10 of The Indian Contract Act,1872 says that the parties entering into a contract must be competent to contract (suitable/qualified by law). On the other hand, Section 11 of the Indian Contract Act,1872 says that a minor (below 18 years of age) is, therefore, not competent to enter into the contract.

There is no such thing as ratification of a minor’s contract. If a person, during the time of entering into the contract is minor, then the contract is void. The minor after becoming a major, cannot rectify the contract (the contract if rectified, will not be valid). It cannot be rectified as it is believed that if a minor does not have the mental capacity to enter into a contract, he shouldn’t be given the authority to rectify it.

A person cannot on attaining majority ratify an agreement made by him during his minority. Ratification relates back to the date of the making of the contract and, therefore, a contract which was then void cannot be made valid by subsequent ratification. It would be a contradiction in terms to say that a void contract can be ratified. In addition to this, if the parties who entered into the contract, show interest can make a new contract with the condition that the consideration in this new contract will be a fresh one as the previous consideration cannot be used again.

For example- Mr. X (a minor) enters into a contract with Mr. Y on 20th October 2019 (this contract is void) to sell his car to him for a certain amount. This contract being void is illegal but if they wish they can enter into a new contract as soon as Mr. X turns 18 with a new consideration.

However, a person can always make a fresh promise after attaining a majority in terms of the promise made during minority. All that is necessary is that there should be some fresh consideration for it

The case involved is of the Kundan Bibi v. Sree Narayan [(1906) 11 CAL W.N. 135] case, a minor enjoyed the benefits of a contract during his minority years and after attaining majority as well. It was held by the court that because there is valid consideration (after attaining majority), the contract is valid.

Thus, in the present case at hand, where a promissory note was signed by a minor for consideration received by him and on attaining majority, he ratifies that promissory note. Such ratification is void because a minor’s agreement is void-ab-initio i.e. void from the very inception of the agreement. Hence, even a minor is not allowed to ratify that void agreement upon attaining the age of majority. Hence, the creditor can’t enforce the agreement based on the fresh ratification of the minor when he becomes a major. The reason is clear that Ratification relates back to the date of the making of the contract and, therefore, a contract which was then void cannot be made valid by subsequent ratification.

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Law of Contract Mains Questions Series: Important Questions for Judiciary, APO & University Exams

1. Law of Contract Mains Questions Series Part-I
2. Law of Contract Mains Questions Series Part-II
3. Law of Contract Mains Questions Series Part-III
4. Law of Contract Mains Questions Series Part-IV
5. Law of Contract Mains Questions Series Part-V
6. Law of Contract Mains Questions Series Part-VI
7. Law of Contract Mains Questions Series Part-VII
8. Law of Contract Mains Questions Series Part-VIII
9. Law of Contract Mains Questions Series Part-IX
10. Law of Contract Mains Questions Series Part-X