BCOC-133 IMPORTANT NOTES UNIT-4 FREE CONSENT

 

                     BCOC-133 IMPORTANT NOTES UNIT-4   FREE CONSENT

Meaning of consent:-it is refers to voluntary agreement or permission given by an individual. Indicating their willingness to participate in a particular action, activity or relationship.

Concepts of free consent:- free consent, in legal terms refers to a situation where individuals willingly and without any coercion, undue influence , fraud , misrepresentation or mistake agree to particular transaction or contractual agreement.

COERCION:-
What is coercion:- it involves the use of force ,threats or intimidation or compel someone to do something against their will. In legal context , coercion can invalidate consent or agreements as it undermines the voluntary nature of the action. Indian law prohibits coercion to protect individuals from being pressured or manipulated into actions they would not otherwise choose.

  1. Committing any act forbidden by the Indian penal code:-when the consent of person is obtained by committing any act which is forbidden by India penal code, the consent is said to be obtained by coercion. (committing a murder, kidnapping, causing hurt, rape , defamation theft etc.) are some of the examples of the act forbidden by Indian law.

  2. Threatening to commit any act forbidden by Indian penal code

  3. Unlawful detaining of any property:-if a person unlawfully detains the property of another

    person and compels him to enter a contract with him, the consent is said to by induced by

    coercion

  4. Threatening to detain any property unlawfully :- if a treat held out to detain any property

    of another person, this is also amount of coercion

  5. Intention of causing any person to enter in to an agreement:-the act of coercion must have

    been done with the object of inducing or compelling a by person to enter into an contract

  6. Threat to file suite:-its not coercion because its not forbidden by Indian penal code

  7. Threat to commit suicide:-according Indian penal code its not punishable ,but an attempt to commit suicide is punishable

Effect of coercion:-particularly the contract is that agreement made under coercion are generally considered voidable. It means that the effected party , the one subjected coercion has the option to either affirm or reject the agreement, if they reject it the contact becomes void. In this case he has to restore the benefit under this contract.
Burden of proof:- it proving that consent was induced by coercion lies on the party who wants to avoid the contract.

UNDUE INFLUENCE
What is undue influence:-it refers the situation where one party in relationship exercises a significant amount of influence over another ,improper or unfair use of one’s superior power in order to obtain the consent of person who is in a weaker position. In legal terms, contract or transactions entered into under influence my be considered voidable.

Presumption of domination of will:- undue influence involved only when one party in a position to dominate the will of other. When

  • He holds a real or apparent authority over the other

  • He stands in a fiduciary relation to others :-it means relationship based on trust and

    confidence eg:- guardian, ward, spiritual adviser, doctor etc.

  • He make contract with a person whose mental capacity is temporarily or permanently

    affected by reason of age ,illness or mental or body distress

    Effect of undue influence:-when consent and agreement is caused by undue influence , the agreement is contract voidable at the option of the party whose consent was so caused. Or set aside. The refunding benefit the court has the discretion to ask the aggrieved party to refunding the benefit either in full or part or set aside the contract.

    Burden of proof:-when party to contract decided to avoid the contract the ground of undue influence, he will have to prove that:-

    1. Theotherpartywasinapositiontodominatehiswill
    2. Theotherpartyactuallyusedhisinfluencetoobtainanunfairadvantage

    Distinction between coercion and undue influence Coercion

Relation between parties is not necessary Consent given under threat of an offence It involves physical force or threat

Undue influence
Some sort of relationship must exist between

parties
Consent is obtained by dominating the will, no offense is committed
It involves moral pressure

It may move from even stranger and maybe against promisor himself or a person in whose welfare the promisor is interested

It is employed by the party to the contract

When contact is avoided, any benefit received has to be restored or refunded

When the contract is avoided, it is at the discretion of the court to direct the aggrieved party to restore or refund the benefit received

FRAUD
What is fraud:-it simply means a willful wrong representation of fact, made by a party to a contract with the intention of deceive the other party or to induce him to enter into a contract. The elements present in the act to constitute fraud:-

  1. False representation:-there must be false representation of fact. this could be a statement, conduct, or concealment

  2. Knowledge of falsity:-the party making false representation must know as the false ,or they should be reckless about the truth

  3. Intent to deceive:-there must be an intent to deceive or induce the other party to act based on the false representation

  4. Reliance:-the deceive party must reasonably relay on the false representation ,and their actions or decisions must be influenced by it

  5. Resulting harm:-there should be actual harm or damage suffered by the party

deceived as a result of relying on the false representation

Does silence amount to fraud:-in generally silence alone doesn’t typically amount to fraud unless there is a legally duty to disclose information. If there is specific duty to speak and a party deliberately remains silent to mislead or deceive another, then it might be considered fraudulent. Duty to speak arise in following cases:-

1.fiduciary relationship 2.contact of absolute faith

Consequences of fraud:-

  1. Voidingofcontact:-acontactenteredunderfraudulentcircumstancesmaybevoidable,

    allowing the victim of fraud to cancel the contact

  2. Civilremedies

  3. Criminalcharges

  4. Recission

  5. Suefordamages

MISREPRESENTATION :-
What is misrepresentation :- it involving making a false statements or presenting misleading information that induce someone to enter into a contract or take some other action. Unlike fraud , misrepresentation does not necessarily involve the intent to deceive . it can occur due to negligence , innocent mistakes or lack of responsible care in verifying the accuracy of the information provided.
There are different type of misrepresentation:-

1. Innocentmisrepresentation:-thisoccurwhenfalseinformationisprovidedwithoutany knowledge of its falsity

2. Negligencemisrepresentation:-ithappenswhenfalseinformationprovidedduetolackof responsible care in checking accuracy.

3. Fraudulentmisrepresentation:-thisissimilartofraud,involvingaknowinglyfalsestatement made to deceive another party

Effect of misrepresentation :-

  1. Recissionofcontract:-thepartywhowasmisledbythemisrepresentationmayhavethe

    right to rescind or cancel the contact. This allows them to be released from their obligations

    under the contact

  2. Damages:-misledpartymaybeentitledtoclaimdamages

  3. Voidable contact :- the affected party can choose whether to affirm or void the contract

Distinction between fraud and misrepresentation:- Fraud

Wrong statement is made intentionally
The person making the wrong statement does not believe it to be true
There is an intention to deceive
Rescinding the contact, the aggrieved party can also claim the damages

Misrepresentation Wrong statement made innocently

The person making the wrong statement believes it to be true
There is no intention to deceive
The aggrieved party can rescind the contact but cannot claim the damages

MISTAKE:-
Wat is mistake:- in a legal term mistake refers to an error or misconception that leads to an incorrect understanding or judgment of a fact or circumstance. Mistake can be classified into different categories. Each with its own legal implications:-

  1. Mistakeoflaw:-generallymistakeoflawarenottypicallyavalidreasontovoidcontract, parties are assumed to know the law, and ignorance as a valid defense

  2. Mistakeoffact:-itinvolvesanerroraboutfactorsetoffact.Ifthemistakeismutualand material it might be grounds for rescinding a contract, it includes :-

3.Bilateral mistakes:-when both parties to an agreements under a mistake of fact essential to the agreement. To declaring the agreement void under this section. The three following condition must satisfied

a. Bothpartiesunderthemistake
b. Mistakemustbeoffactandnotoflaw c. Mistake must relate to essential fact

Bilateral mistakes may be (a) mistakes as to subject matter or (b) mistakes as to possibility of performance
4.Unilateral mistake:- occurs when one party makes an error , but the other party is aware of the mistake or has no reason to believe it exist. Generally unilateral mistake does not provide a basis for avoiding a contact.

The following cases even though the mistake is unilateral, the agreement is void
1.mistake as to the identity of the person contracted with:- mistake as to the identity of the person violates a contract
2. mistake as to the nature of the contract :-the contact is void when one of the parties, without any fault of his own, makes mistake as to the very nature of the contract.

Effect of mistake :-

  1. When the both parties to an agreement are under mistake as to a matter off act essential to

    agreement , the agreement is void

  2. In most cases of unilateral mistake, the contract is not void, but where unilateral mistake

    defeats the true consent of the parties, the agreement treated as void

  3. Any person who has received advantage under such agreement ,he is bound to restore it or

    to make compensation for it , the person who he had received it

  4. A person to whom money has been paid or anything delivered by mistake must repay or

    return it .

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