Monday, October 08, 2007

Contract Act_Practical Problems_12

A, a minor, borrowed Rs. 5,000 on loan from B, staling that he was a major and executed a receipt in his favour. Discuss the remedies available to B to recover the money lent by him.

A minor is always allowed to plead minority and is not estopped to do so even where he had procured a loan or entered into some other contract by falsely representing that he was of full age. In Leslie v. Shiell, S, a minor, borrowed £ 400 from L, a money lender, by fraudulently misrepresenting that he was of full age. On default to pay by S, L sued for return of the £ 400 and damages for the tort of deceit. Held, L could not recover £ 400 and his claim for damages also failed. The Court did not grant relief, otherwise it would have been an indirect way of enforcing a void contract. Even on equitable grounds, the minor could not be asked to refund £ 400, as the money was not traceable and the minor had already spent the same.

Thus, in the given case, the agreement being void, B shall not be allowed to recover the money. However, if the money can be traced with A, the minor shall be liable, on equitable grounds, to restore the same since a minor cannot be given a liberty to cheat.

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